Frozen Food Express v. Interstate Commerce Commission/Opinion of the Court

Part II of the Interstate Commerce Act, 49 Stat. 543, as amended, 49 U.S.C. § 301 et seq., 49 U.S.C.A. § 301 et seq., grants the Commission pervasive control over motor carriers. Common carriers and contract carriers by motor vehicle, subject to that part of the Act, must have a certificate of public convenience and necessity or a permit issued by the Commission. §§ 206(a), 209(a). The Commission has powers of investigation to determine if a motor carrier has complied with the Act; and it has authority to issue an order compelling compliance. § 204(c). These requirements for a certificate or permit are not, however, applicable to 'motor vehicles used in carrying property consisting of ordinary livestock, fish (including shell fish), or agricultural (including horticultural) commodities (not including manufactured products thereof), if such motor vehicles are not used in carrying any other property, or passengers for compensation.' § 203(b)(6).

The controversy in these cases centers around this 'agricultural' exemption. After an investigation instituted on its own motion, the Commission issued an order that specified commodities are not 'agricultural' within the meaning of § 203(b)(6).

The hearing to determine the meaning and application of the term 'agricultural * *  * commodities (not including manufactured products thereof)' as used in § 203(b)(6) was held before an examiner. It was a public hearing at which various governmental officials and agencies and various producers, shippers, and carriers appeared and presented evidence. The Commission's decision was in the form of a report and order. 52 M.C.C. 511. The report, which concerns various groups of commodities, covers 71 pages of the printed record. The findings list those commodities that the Commission finds are exempted under § 203(b)(6) and those that are not. The order of the Commission incorporates the 'findings' and states that the proceeding 'be, and it is hereby discontinued.'

Frozen Food Express, the plaintiff, is a motor carrier transporting numerous commodities which the Commission ruled were nonexempt under § 203(b)(6) but which the carrier claims are 'agricultural commodities.' Plaintiff, who was not a party to the administrative proceeding, instituted suit before a three-judge District Court, 28 U.S.C. § 2325, 28 U.S.C.A. § 2325, to enjoin the order of the Commission and have it set aside, naming the United States and the Commission as defendants. 28 U.S.C. § 1336, 28 U.S.C.A. § 1336; 49 Stat. 550, as amended, 49 U.S.C. § 305(g), 49 U.S.C.A. § 305(g); 60 Stat. 243, 5 U.S.C. § 1009, 5 U.S.C.A. § 1009. The complaint alleged that plaintiff is a common carrier by motor vehicle, holding a certificate of public convenience and necessity which authorizes it to transport certain commodities between designated points and places; that plaintiff is transporting, in addition to those commodities, commodities which are exempt under § 203(b)(6) and for which plaintiff has sought no authority from the Commission; that the Commission in its order has held the latter commodities nonexempt and accordingly has deprived it of the right granted by the statute; that the order of the Commission classifying certain commodities as nonexempt is unlawful; and that the Commission threatens to enjoin transportation of the commodities which plaintiff claims are exempt. The Secretary of Agriculture intervened, supporting plaintiff's position on some of the commodities. Other interveners are trucking associations and railroads which support the Commission. The United States as a defendant supports the Commission on some of its findings and opposes it on others.

The District Court, being of the view that the case was controlled by United States v. Los Angeles & S.L.R. Co., 273 U.S. 299, 47 S.Ct. 413, 71 L.Ed. 651, dismissed the action, saying that the 'order' of the Commission was not subject to judicial review. 128 F.Supp. 374. The cases are here by appeal. 28 U.S.C. §§ 1253, 2101(b), 28 U.S.C.A. §§ 1253, 2101(b).

We disagree with the District Court. We do not think United States v. Los Angeles & S.L.R. Co., supra, is controlling here. In that case the 'order' held nonreviewable was a valuation of a carrier's property made by the Commission. The Court held that the 'order' was no more than a report of an investigation which might never be the basis of a proceeding before the Commission or a court. Mr. Justice Brandeis, speaking for the Court, said:

'The so-called order here complained of is one which does not     command the carrier to do, or to refrain from doing, any      thing; which does not grant or withhold any authority,      privilege, or license; which does not extend or abridge any      power or facility; which does not subject the carrier to any      liability, civil or criminal; which does not change the      carrier's existing or future status or condition; which does      not determine any right or obligation. This so-called order     is merely the formal record of conclusions reached after a      study of data collected in the course of extensive research      conducted by the Commission, through its employees. It is the     exercise solely of the function of investigation. * *  * ' 273      U.S. 309-310, 47 S.Ct. 413, 414, 71 L.Ed. 651.

The situation here is quite different. The determination by the Commission that a commodity is not an exempt agricultural product has an immediate and practical impact on carriers who are transporting the commodities, and on shippers as well. The 'order' of the Commission warns every carrier, who does not have authority from the Commission to transport those commodities, that it does so at the risk of incurring criminal penalties. § 222(a). Where unauthorized operations occur, the Commission may proceed administratively and issue a cease and desist order. § 204(c). Such orders of the Commission are enforceable by the courts. § 222(b). And wilful violation of a cease and desist order is ground for revocation of a certificate or permit. § 212. The determination made by the Commission is not therefore abstract, theoretical, or academic. Cf. El Dorado Oil Works v. United States, 328 U.S. 12, 18-19, 66 S.Ct. 843, 846-847, 90 L.Ed. 1053. The 'order' of the Commission which classifies commodities as exempt or nonexempt is, indeed, the basis for carriers in ordering and arranging their affairs. Cf. Rochester Telephone Corp. v. United States, 307 U.S. 125, 132, 59 S.Ct. 754, 757, 758, 83 L.Ed. 1147. Carriers who are without the appropriate certificate or permit, because they believe they carry exempt commodities, run civil and criminal risks. A carrier authorized to carry specified commodities and dependent on exempt articles for its return load may lose its right to operate at all, if it does not respect the Commission's 'order.' Carriers and shippers alike are told that they are or are not free to bargain for rates, that they must or must not pay the filed charges. The 'order' of the Commission is in substance a 'declaratory' one, see 60 Stat. 240, 5 U.S.C. § 1004(d), 5 U.S.C.A. § 1004(d), which touches vital interests of carriers and shippers alike and sets the standard for shaping the manner in which an important segment of the trucking business will be done. Cf. Columbia Broadcasting System v. United States, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563. The consequences we have summarized are not conjectural. The Commission itself places this interpretation on its action and argues, contrary to its position in the Los Angeles case, supra, for finality of the order. We conclude that the issues raised in the complaint are justiciable and that the District Court should adjudicate the merits.

Reversed.

Mr. Justice HARLAN, dissenting.