Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

MOVERS' & WAREHOUSEMEN'S ASSN. OF AMERICA

June 23, 1969

MOVERS' & WAREHOUSEMEN'S ASSOCIATION OF AMERICA, Inc., Plaintiff,
v.
UNITED STATES of America and the Interstate Commerce Commission, Defendants, PepsiCo, Inc., Spedco, Inc., and North American Van Lines, Inc., Intervening Defendants



The opinion of the court was delivered by: FORMAN

This is an action based on a complaint brought by plaintiff Movers' & Warehousemen's Association of America, Inc., seeking to enjoin, annul and set aside an order of the Interstate Commerce Commission served on February 29, 1968, approving the acquisition of North American Van Lines, Inc. (NAVL) by Spedco, Inc., a wholly owned subsidiary of PepsiCo, Inc., in Docket No. MC-F-9463. The complaint also attacks the final order of the Commission in which it deferred exercise of the power sought in a concurrent application, Docket No. MC-F-9464, to substitute Spedco for NAVL in the latter's pooling plan and in which it provided that consummation of the acquisition in No. MC-F-9463 should not take place until a proposed new pooling agreement was filed with the Commission.

The United States joined the Commission in the defense of this action. NAVL, PepsiCo and Spedco have intervened as defendants, and jurisdiction of this court is founded upon 28 U.S.C. §§ 1336, 1398, 2284, 2321-2325 and 49 U.S.C. § 17(9). A brief description of the parties is essential to an understanding of the issues raised herein.

Plaintiff Movers' & Warehousemen's Association of America, Inc., is a non-profit organization of 577 independent motor carriers engaged in transporting household goods throughout the United States. Its major function is the publication of its members' tariffs with the Interstate Commerce Commission. Although its members vary in size, several are national 'system carriers' operating primarily through local agents.

 PepsiCo is a huge corporate structure engaged in many varied operations through five major subdivisions: (1) Pepsi Cola produces and distributes soft drinks throughout the United States; (2) Frito-Lay produces and markets snack or convenience foods throughout the United States; (3) PepsiCo International markets PepsiCo products in foreign countries; (4) Empire State Sugar refines and sells sugar, with refineries in Long Island City and Auburn, New York; and (5) Lease Plan International (LPI), PepsiCo's service division, which in turn has four divisions operating through fifty-six subsidiaries. In addition to leasing automobiles, trucks and trailers, LPI controls two contract carriers, *fn1" Beer Transport, Inc. and Relay Transport, Inc.; and three common carriers, National Trailer Convoy, Inc., Whitehouse Trucking, Inc., and Flagstaff Trailer Sales, Inc. Details of the operations conducted by these carriers will be discussed in connection with plaintiff's anti-trust arguments. Suffice it to say for the present, that all are subject to regulation in one form or another by the Interstate Commerce Commission.

 Spedco is a wholly owned subsidiary of PepsiCo, created in 1966 for the express purpose of acquiring NAVL.

 NAVL is a motor common carrier with nationwide Commission authority to transport household goods and limited authority to transport 'new products' including furniture, office and household fixtures, office equipment, pianos and organs. In 1965 it ranked second among household goods carriers in the United States in terms of gross revenues. NAVL, like other major household goods carriers, including a large number of plaintiff's members, operates under an agency system wherein local representatives, many of whom themselves possess authority to transport household goods in a limited geographical area, solicit and accept shipments for the account of a national carrier.

 Spedco and NAVL simultaneously filed an application (No. MC-F-9464) under § 5(1) of the Interstate Commerce Act, *fn3" seeking the substitution of Spedco for NAVL in the latter's pooling agreement, previously approved by the Commission in No. MC-F-4551, North American Van Lines, Inc. -- Pooling, *fn4" which provided for the pooling of traffic, service, and revenues among NAVL and its various carrier agents.

 Both applications were referred to a Commission Hearing Examiner for hearing on a joint record. In addition to plaintiff, Aero-Mayflower Transit Company, Inc., Fernstrom Storage and Van Company, United Van Lines, Inc., Mural Transport, Inc. and the Irregular Route Conference of the American Trucking Association, Inc. either filed timely protests or intervened in opposition to the acquisition application. *fn5" All except plaintiff withdrew at different stages of the proceedings. No protests were filed in No. MC-F-9464, the pooling application, and no evidence was introduced before the Hearing Examiner on this subject.

 On August 23, 1967, the Examiner issued his Recommended Report and Order approving both the acquisition and the pooling applications. In pertinent part, the Examiner concluded that the acquisition

 '(1) would not foster anti-competitive consequences contrary to the public interest and the national transportation policy; (2) would not create an environment in which preferences, discriminations, and unfair destructive competitive practices would obtain and flourish; (3) would result in little, if any, diversion of household goods and new products traffic from protestants * * *; and (5) would not have any substantial detrimental effect to the Nation's common carrier system of transportation. 'Affiliation of North American with Pepsico will provide the former with a more influential and substantial financial base which will be an entree of this specialized industry into a more stable economy. Pepsico would make available to North American knowledgeable management techniques and skills assuring more efficient service in the transportation of household goods and new products from which other carriers of the same commodities should benefit. * * * And subject to the conditions hereinafter enumerated the examiner concludes that the application in No. MC-F-9463, would be consistent with the public interest and the national transportation policy.

 'The substitution of Spedco, and its successor-in-interest North American Van Lines, Inc., in lieu of North American in the pooling agreement, approved and authorized by this Commission in North American Van Lines, Inc. -- Investigation of Control, supra, * * * will be in the interests of better service to the public, and of economy in operation, and will not unduly restrain competition, and the application should be approved and the examiner so concludes.' *fn6"

 After exceptions had been filed to the Hearing Examiner's recommended decision, Division 3 of the Commission, in a decision and order served on February 29, 1968, affirmed and adopted as its own the findings of fact and conclusions of law of the Hearing Examiner with certain exceptions. *fn7" With respect to the pooling application the Commission ruled that since NAVL's arrangement had been approved thirteen years earlier and it was 'inconceivable * * * that all of the parties to that agreement would still have the same name and address and would still hold the same operating rights insofar as any of them were carriers,' the new agreement as it would be adopted by Spedco would have to be filed with the Commission, bringing all of the relevant information up to date. Consummation of the acquisition transaction was not to occur until compliance with this mandate had been effectuated. *fn8" Plaintiff's petition for reconsideration was denied by Division 3, acting as an Appellate Division, in an order served on May 8, 1968.

 The complaint in this court was filed on May 23, 1968, and pursuant to an order of June 4, 1968 a three-judge court was convened to hear argument. Plaintiff's motion for a temporary ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.