Concluding from the protesting appellant feed manufacturers'
evidence that, though appellee railroads' proposed new tariffs
would increase through rates on meal and related articles used in
making feed, the railroads would lose revenue because of diversion
of meal traffic to trucks, the Interstate Commerce Commission (ICC)
canceled the proposed tariffs. The District Court set aside and
annulled the ICC's order for want of substantial evidence to
support it, viewing the shippers' evidence as mere conjecture and
self-serving and finding that, instead of losing revenue from the
new tariffs, the railroads would improve their financial position
notwithstanding any predicted traffic diversion.
Held: The District Court exceeded its function in
reweighing the testimony, and, on the record before it, erred in
differing with the ICC and agreeing with the railroads on the
impact of the new tariffs on railroad revenue.
397 F.
Supp. 607, reversed.
PER CURIAM.
This is an appeal from the judgment of a three-judge District
Court setting aside and annulling a decision and order of the
Interstate Commerce Commission.
Louisville & Nashville R.
Co. v. United States, 397 F.
Supp. 607 (WD Ky.1975).
In 1973, the railroads in southern territory, which lies south
of the Ohio River and east of the Mississippi, proposed new tariffs
changing the method of calculating the through rates on vegetable
oil, cake or meal, and related articles, which were subject to
transit privileges at various points where animal, fish, and
poultry feed using these ingredients was made and transshipped.
Certain
Page 426 U. S. 477
large feed manufacturers protested. The Commission found that
the net effect of the new tariffs would be to increase the through
rates on the articles involved, and that the railroads had "not
presented probative evidence in justification" of the new tariffs.
Based on the testimony and evidence presented by the protestants,
the Commission found
"strong support on this record for concluding that these
shippers will divert a considerable portion of their feed traffic
from railroad to trucks with the establishment of the proposed
rule."
The result, the Commission found, would be "a net loss of
revenue to the [railroads] despite the assessment of the higher
rates and charges, and thus will be self-defeating." The Commission
concluded that the railroads had not met their burden of proof that
the proposed tariffs were just and reasonable under § 15 of the
Interstate Commerce Act, 24 Stat. 384, as amended, 49 U.S.C. §
15(7), and required that the railroads cancel the schedule. 346
I.C.C. 579, 587-588 (1973).
The District Court set aside and annulled the Commission order
for want of substantial evidence to support it. The District Court
considered the shippers' evidence mere conjecture and self-serving,
and could not accept the Commission's conclusion that the railroads
would lose revenue from the new tariffs. It also thought it
"uncontroverted" that "the railroads have incurred a loss of
revenue from the transportation of meal," and therefore
"clearly established that, if there should be a diversion of
meal traffic as predicted by the shippers, the carriers would
actually be in a better financial position than at present."
397 F. Supp. at 610.
We reverse the judgment of the District Court. Concededly, there
was detailed evidence with respect to the anticipated traffic
diversion which the Commission credited and thought strongly
supported its conclusion. The District Court exceeded its function
in reweighing the
Page 426 U. S. 478
testimony, which is primarily the task of the Commission.
Alton R. Co. v. United States, 315 U. S.
15,
315 U. S. 23-24
(1942);
Illinois C. R. Co. v. Norfolk & T. R. Co.,
385 U. S. 57,
385 U. S. 69
(1966). On the record before it, the District Court also erred in
differing with the Commission and agreeing with the railroads with
respect to the impact of the new tariffs on railroad revenue. The
court relied on evidence which showed only that, under the old
rates, the railroads sustained a loss on feed outbound from the
transit points and which, as a railroad witness testified, Comm'n
Tr. 28-29, did not relate to the net gain or loss on inbound meal
shipments or on the through movement when both legs were considered
together.
Reversed.
MR. JUSTICE POWELL took no part in the consideration or decision
of this case.