APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK.
Warren, Black, Frankfurter, Douglas, Burton, Clark, Harlan, Brennan, Whittaker
The judgment of the District Court is reversed and the case is remanded for consideration by that court of the only claim that was left open at this Court's prior disposition of this litigation, to wit, whether "the preferred stock issue as approved by the [Interstate Commerce] Commission was in violation of the Interstate Commerce Act." Alleghany Corp. v. Breswick & Co., 353 U.S. 151, 175.
156 F.Supp. 227, reversed and remanded.
MR. JUSTICE DOUGLAS, with whom THE CHIEF JUSTICE and MR. JUSTICE BLACK concur, dissenting.
These cases are a sequel to Alleghany Corporation v. Breswick & Co., 353 U.S. 151. There, the decision of the District Court was reversed and the case was remanded for further proceedings. Now, the decision of the District Court on remand is being summarily reversed on the ground that the basis of the decision below was precluded by the mandate and opinion of this Court. For the reasons which follow, it is my opinion that probable jurisdiction should be noted in these cases.
First. I do not agree that the decision below went beyond the scope of the opinion and mandate of this Court.
Alleghany Corporation acquired control of the New York Central Railroad Co., the parent of an integrated system of carriers. Subsequent to the acquisition of control by Alleghany, two of the corporate subsidiaries of the Central system were merged. Alleghany is basically subject
to the control of the Securities and Exchange Commission under the Investment Company Act of 1940, 54 Stat. 789, 15 U. S. C. § 80a-1 et seq. Section 3 (c)(9) of that Act exempts companies which are subject to regulation by the Interstate Commerce Commission. The question thus arose as to whether Alleghany, although not a carrier as that term is used in the Interstate Commerce Act, was subject to regulation by the Interstate Commerce Commission because of the merger of the subsidiaries of Central of which Alleghany acquired control and therefore exempt from supervision by the Securities and Exchange Commission. The determination of the Interstate Commerce Commission that Alleghany was under its jurisdiction was reversed by the District Court but this Court then reversed the District Court. 353 U.S. 151. The scope of that holding is the present issue.
In order to attain the status of a carrier the noncarrier must satisfy the requirements of § 5 (2)(a) of the Interstate Commerce Act. The pertinent portions of that section provide:
"It shall be lawful, with the approval and authorization of the Commission . . . (i) . . . for a person which is not a carrier to acquire control of two or more carriers through ownership of their stock or otherwise; or for a person which is not a carrier and which has control of one or more carriers to acquire control of another carrier through ...