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May 13, 1957

Horace BANTA, Trustee of the Property of The New Jersey and New York Railroad Company, Plaintiff,
UNITED STATES of America and Interstate Commerce Commission, Defendants

The opinion of the court was delivered by: GOODRICH

The plaintiff brings this action for a decree 'suspending, enjoining, annulling and setting * * * aside' an order of the Interstate Commerce Commission and for an order directing the Commission to grant affirmative relief. It is an appeal from a Commission order to a three-judge district court pursuant to 28 U.S.C. §§ 1336, 2284 and 2321-2325.

The factual story is short and undisputed. Plaintiff is trustee of The New Jersey and New York Railroad Company which has been in a Section 77 reorganization proceeding, 11 U.S.C.A. § 205, since June 30, 1938, and is still there. Its overall operations are being conducted at a financial loss. The plaintiff, as trustee, wishes to discontinue one weekday passenger train called number 613. This train operates westbound from Jersey City, N.J. to Spring Valley, N.Y. A daily average of customers on 613 is 162 passengers of whom 33 are nonrevenue and 36 are intrastate passengers. The trustee desires to add some coaches to another train which leaves Jersey City a little later in the afternoon than Train 613 thus, he says, adequately caring for the service now provided and saving the money-losing railroad something more than $ 30,000 a year.

 Plaintiff first went to the Board of Public Utility Commissioners of New Jersey and made application to discontinue the operation of this Train 613 within the State of New Jersey. The New Jersey board denied the application. This denial was affirmed by the appellate division of the Superior Court of New Jersey. In re New Jersey & New York R. Co., 1952, 23 N.J.Super. 1, 92 A.2d 515. The Supreme Court of New Jersey affirmed the Superior Court. 1953, 12 N.J. 281, 96 A.2d 526. The Supreme Court of the United States dismissed the appeal from the Supreme Court of New Jersey for want of a substantial federal question. New Jersey & N.Y.R. Co. v. Board of Public Utility Com'rs, 1953, 346 U.S. 868, 74 S. Ct. 123, 98 L. Ed. 378.

 Next the plaintiff went to the Interstate Commerce Commission for help and met with the same lack of success that he had before the New Jersey Board and the New Jersey courts. 299 I.C.C. 41 (1956). He then came to this Court. We are not going to help him either but in deciding so are moved to say that plaintiff has made a very able argument and got all there is to be had from a difficult case.

 It is agreed between the parties that the Interstate Commerce Commission has no authority to allow a railroad to discontinue an individual interstate train. Palmer v. Commonwealth of Massachusetts, 1939, 308 U.S. 79, 60 S. Ct. 34, 84 L. Ed. 93. So the plaintiff is compelled to proceed indirectly, pressing the novel contention that the Interstate Commerce Act, 49 U.S.C.A. § 1 et seq., is violated by the state-required operation of this particular train.

 The plaintiff first turns to Section 13(3) and (4) of the statute. Here they are:

 § 13(3) 'Investigation involving State regulations; conference of State and interstate commissions.

 'Whenever in any investigation under the provisions of this chapter, or in any investigation instituted upon petition of the carrier concerned, which petition is hereby authorized to be filed, there shall be brought in issue any rate, fare, charge, classification, regulation, or practice, made or imposed by authority of any State, the commission, before proceeding to hear and dispose of such issue, shall cause the State or States interested to be notified of the proceeding. The commission may confer with the authorities of any State having regulatory jurisdiction over the class of persons and corporations subject to this chapter or chapter 12 of this title with respect to the relationship between rate structures and practices of carriers subject to the jurisdiction of such State bodies and of the commission; and to that end is authorized and empowered, under rules to be prescribed by it, and which may be modified from time to time, to hold joint hearings with any such State regulating bodies on any matters wherein the commission is empowered to act and where the ratemaking authority of a State is or may be affected by the action taken by the commission. The commission is also authorized to avail itself of the cooperation, services, records, and facilities of such State authorities in the enforcement of any provision of this chapter or chapter 12 of this title.'

 § 13(4) 'Duty of Commission where State regulations result in discrimination.

 'Whenever in any such investigation the commission, after full hearing, finds that any such rate, fare, charge, classification, regulation, or practice causes any undue or unreasonable advantage, preference, or prejudice as between persons or localities in intrastate commerce on the one hand and interstate or foreign commerce on the other hand, or any undue, unreasonable, or unjust discrimination against interstate or foreign commerce, which is forbidden and declared to be unlawful, it shall prescribe the rate, fare, or charge, or the maximum or minimum, or maximum and minimum, thereafter to be charged, and the classification, regulation, or practice thereafter to be observed, in such manner as, in its judgment, will remove such advantage, preference, prejudice, or discrimination. Such rates, fares, charges, classifications, regulations, and practices shall be observed while in effect by the carriers parties to such proceeding affected thereby, the law of any State or the decision or order of any State authority to the contrary notwithstanding.' 49 U.S.C.A. § 13(3, 4).

 The Commission says that this section does not give it jurisdiction in such a case as this. Plaintiff says that is incorrect and says that the Supreme Court of the United States so held in Alabama Public Service Comm. v. Southern Ry. Co., 1951, 341 U.S. 341, 71 S. Ct. 762, 95 L. Ed. 1002. In that case a three-judge federal district court had enjoined enforcement of an order of the Alabama Public Service Commission. There had been no appeal to the state courts from that commission's order. In the course of the discussion in footnote 9 on pages 346-347, of 341 U.S., on page 767 of 71 S. Ct., Mr. Chief Justice Vinson, who wrote the opinion for the Court, said:

 '9. As the jurisdiction of the Interstate Commerce Commission under 49 U.S.C. § 13(4), has not been invoked for decision as to whether the continuance of this intrastate service constitutes an undue discrimination against interstate commerce we cannot, in this proceeding, consider any impact the order of the Alabama Public Service Commission might have on interstate commerce. Western & Atlantic R. Co. v. Georgia Pub. Serv. Comm., 1925, 267 U.S. 493 [45 S. Ct. 409, 69 L. Ed. 753], and cases cited therein.'

 We think the reliance by the plaintiff upon this footnote is misplaced. The issue before the Court was not the jurisdiction of the Interstate Commerce Commission but the propriety of exercise of authority by a federal court enjoining enforcement of a state regulatory order. The cases cited in the footnote are instances where the Commission admittedly had jurisdiction.

 Nor do we find in the plaintiff's recital of legislative history anything to bolster his case. Indeed, the legislative history cited by the Interstate Commerce Commission shows pretty clearly, we think, that the attention of the Congress was upon rates and rate discrimination and that it was following up the decision in the Shreveport Rate Case. ( Houston, E. & W.T. Ry. Co. v. United States, 1914, 234 U.S. 342, 34 S. Ct. 833, 58 L. Ed. 1341), which had been decided not long before. For a summary of legislative history of Section 13(3) and (4) see Missouri Pac. R. Co. v. Norwood, ...

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