Illinois Commerce Commission v. United States
292 U.S. 474 (1934)

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U.S. Supreme Court

Illinois Commerce Commission v. United States, 292 U.S. 474 (1934)

Illinois Commerce Commission v. United States

No. 787

Argued April 30, May 1, 1934

Decided May 28, 1934

292 U.S. 474

APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES

FOR THE NORTHERN DISTRICT OF ILLINOIS

Syllabus

1. Under § 13(4) of the Interstate Commerce Act, the Interstate Commerce Commission is given plenary power to remove the discrimination created by intrastate rates against interstate commerce by raising intrastate rates so that the intrastate traffic may produce its fair share of the revenue required to meet maintenance and operating costs and to yield a fair return on the value of property devoted to the transportation service. P. 292 U. S. 479.

2. In a hearing before the Interstate Commerce Commission to determine whether intrastate switching rates in the Chicago Switching District should be increased to the level of interstate rates in order to do away with discrimination against interstate commerce, the question whether a cost study used at an earlier hearing was adequate and representative of conditions existing at the time of the later hearing, or should be refined and supplemented, was a question of fact for the determination of the Commission, which will not be disturbed when supported by evidence. P. 292 U. S. 480.

3. Findings of the Interstate Commerce Commission supporting its order for the raising of intrastate rates to the level of interstate rates for switching in the Chicago Switching District are to be read in the light of traffic conditions in the District as disclosed in the evidence before the Commission and described in its report. P. 292 U. S. 481.

4. Findings of the Interstate Commerce Commission showing that the Chicago Switching District (situate part in Illinois and part in Indiana) is essentially a unit, so far as switching movements are concerned, that the interstate and intrastate traffic are commingled and handled indiscriminately in the same manner, often in the same trains and by the same crews, that the movements have no relation to main-line-hauls, but are chiefly between local industries, and involve a complete service originating and terminating within the District, that transportation conditions throughout the District are substantially similar, that the established interstate scale is reasonable, and not shown to cause any undue preference or advantage to persons or localities in intrastate or interstate commerce,

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that the lower intrastate rates have resulted, and will result, in unjust discrimination against interstate commerce, that they caused loss of carrier revenue, and that their increase to the level of the interstate rates will probably result in increase of such revenues -- held ample to support the Commission's order raising the intrastate rates accordingly. P. 292 U. S. 482.

5. Where the conditions under which interstate and intrastate traffic move are found to be substantially the same with respect to all factors bearing on the reasonableness of the rate, and the two classes are shown to be intimately bound together, there is no occasion to deal with the reasonableness of the intrastate rates more specifically, or to separate intrastate and interstate costs and revenues. P. 292 U. S. 483.

6. The effect of maintaining an intrastate rate lower than the reasonable interstate rate is necessarily discriminatory wherever the two classes of traffic, inextricably intermingled, are carried on, as in the Chicago Switching District, under substantially the same conditions. P. 292 U. S. 485.

7. There was evidence in support of the Commission's conclusion that the area should be treated as a unit, and a uniform blanket or group rate applied within it, rather than distance or zone rates. P. 292 U. S. 485.

8. An order, made applicable to all carriers in the Chicago Switching District, directing that intrastate switching rates shall be maintained on a parity with the interstate rates "contemporaneously applied by said carriers," interpreted in the light of the report, applies to interstate carriers whose rails in the district are confined to one State and which, for that reason, have filed no interstate switching rate, and requires them to adopt the prescribed intrastate rate. P. 292 U. S. 486.

9. The rule that a carrier may not be required to remove discrimination against a locality unless it participates in both the prejudicial and preferential rates is irrelevant to proceedings under § 13(4) of the Interstate Commerce Act for removal of discrimination against interstate commerce caused by intrastate rates maintained by state authority. P. 292 U. S. 487.

Affirmed.

Appeal from a decree of the District Court, constituted of three judges, which dismissed a bill brought against the United States and 37 railroad corporations by two

Page 292 U. S. 476

ratemaking commissions of the States of Illinois and Indiana, respectively, and by other parties, to set aside an order of the Interstate Commerce Commission. That Commission intervened.

MR. JUSTICE STONE delivered the opinion of the Court.

This is an appeal under the Urgent Deficiencies Act of October 22, 1913, c. 32, 38 Stat. 208, 219-220, from a decree of a District Court for Northern Illinois, three judges sitting, which dismissed the complaint upon which appellants sought to set aside an order of the Interstate Commerce Commission.

The order, made under § 13(3)(4) of the Interstate Commerce Act, directed the removal of unjust discrimination against interstate commerce, resulting from disparity of the intrastate and interstate switching rates of interstate rail carriers in the Chicago Switching District, lying partly in Illinois and partly in Indiana. It provided that the intrastate rate should be not less than the interstate switching rates prescribed in an earlier order

Page 292 U. S. 477

of the Commission in Switching Rates in Chicago Switching District, 177, I.C.C. 669, of 3

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