# Safir v. Gibson > Court of Appeals for the Second Circuit · February 26, 1970 · 432 F.2d 137 URL: https://www.frixlaw.com/law-library/cases/8883794 ## Case - **Full name:** Marshall P. SAFIR, Arnold Weissberger and Sapphire Steamship Lines, Inc. v. Andrew GIBSON, Successor to and Substituted for James W. Gulick, Acting Maritime Administrator, Maritime Administration, United States Department of Commerce, James S. Dawson, Jr., Secretary, Maritime Subsidiary Board, Maritime Administration, United States Department of Commerce, and Maurice Stans, Successor to and Substituted for C. R. Smith, Secretary of Commerce of the United States, American Export Isbrandtsen Lines, Inc., Bloomfield Steamship Co., Lykes Bros. Steamship Company, Inc., Moore-McCormack Lines, Inc., United States Lines, Inc., American President Lines, Ltd., Prudential Steamship Co., Inc. and Prudential Grace Lines, Inc., and Farrell Lines, Inc., Intervenors - **Court:** Court of Appeals for the Second Circuit - **Decided:** February 26, 1970 - **Citations:** 432 F.2d 137 - **Precedential status:** Published - **Opinion:** On rehearing - **Judges:** Feinberg, Friendly, Lumbard - **Cited by:** 42 later opinions in the Frix Law Library ## Citator (automated) - No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases. - Full citator and citing cases: https://www.frixlaw.com/law-library/cases/8883794 ## How later opinions describe it (automated extraction) - holding that a Federal Mari- time Commission decision was entitled to preclusive effect, noting the FMC’s expertise and that the issues “were fully litigated before the agency designated to determine them” ## Opinion text On Petitions of Intervenors for Rehearing PER CURIAM: In our decision of February 26, 1970, at 137, we directed the district court "to instruct the Maritime Administration not to redetermine the issue whether the AGAFBO carriers’ concerted action in reducing their rates to an unreasonably low level and holding them there for eleven months was unjustly discriminatory or unfair to Sapphire.” Shortly thereafter, the AGAFBO lines, which, although fully aware of this action, had been sedulously abstaining from participation, see 417 F.2d 972 , 976 n. 4 (1969); at 140, sought leave to intervene for the purpose of seeking a rehearing on that portion of our decision. We granted such leave, received petitions and accompanying briefs, and then called upon counsel for the appellants and appellees to respond. 1 The argument most strongly pressed by the intervenors is that they had no sufficient incentive and, indeed, no opportunity to appeal the adverse findings of the FMC, see at 143. The latter branch of the argument hangs mainly on the fact that the rates found by the FMC to give rise to a violation of § 15 - of the Shipping Act had expired and therefore could no longer be disapproved under § 18(b) (5). But § 15 subjects offending lines to a penalty of $1000 per day of violation. Since the FMC’s determination would be conclusive in a civil action for penalties, it was therefore clearly appealable. See Pacific Far East Line, Inc. v. FMC, 133 U.S.App.D.C. 269 , 410 F.2d 257 (1969). In view of the sharp tone of the FMC report and the even sharper one of the separate opinion of two members, the intervenors could hardly have taken lightly the threat of the Government’s suing for a penalty; indeed, we are informed that five of them have recently settled their liability by paying $25,000 each. Moreover, while we relied mainly on this point, at 143, we did not at all mean to suggest that the AGAFBO lines should not have been aware of the possible effect of the FMC determination in a proceeding under § 810 of the Merchant Marine Act, of whose potentiality they were apprised very shortly after the FMC decision. The Government makes the point that if appellants wished to have the Maritime Subsidy Board give conclusive effect to the FMC decision, the Board has a procedure enabling them to raise this matter in limine. They could have moved for a summary disposition of the issue by the Hearing Examiner, 46 C.F.R. 201.91, could have requested permission from him to appeal an adverse decision to the full Maritime Adminis *146 tration, 46 C.F.R. 201.93, and if that were granted and the appeal proved unsuccessful, could have sought further review by the Secretary of Commerce, 46 C.F.R. 202.1. Be all this as it may, we were faced with a statement by the district judge implying that the FMC determination did not have binding effect, at 140, and, after two and a half years, we see no point in launching appellants on the wearisome course the Government has plotted when we are clear that the legal issue must be decided in their favor. The short of the matter is that nothing advanced by the intervenors or the Government alters our conclusion that “it would be quite unseemly for the Maritime Administration to conclude that its sister agency had been wrong in a fully litigated issue the decision of which Congress had confided to it.” at 143. Two minor points should be mentioned. Four intervenors, American President Lines, Ltd., Prudential Steamship Co., Inc., Prudential-Grace Lines, Inc. and Farrell Lines, Inc., urge that they were not competing with Sapphire, had no interest in the rates which the FMC condemned and never voted on these. We see no reason for the concern felt by these carriers. We directed only that the issue whether the reduction of the rates was unjustly discriminatory or unfair to Sapphire was not to be relitigated before the Maritime Administration; we said nothing about who was responsible for these and, by a footnote 2, emphasized that “Nothing we have said should be read as preventing the Maritime Administration from investigating the nature and extent of the individual carriers' participation in the illegal action * * * ” On the other side, the Government is fearful lest “the tenor of the opinion and the rationale underlying it would appear to foreclose the Maritime Subsidy Board from investigating and concluding, contrary to a majority of the FMC, that a wider conspiracy existed.” But there was no “majority” finding on the issue of a wider conspiracy, since the four participating members divided two to two. The issue therefore remains open. The intervenors’ petitions for rehearing are denied. . We requested counsel for the appellees to obtain the views of the Federal Maritime Commission. The latter, taking no position with respect to other issues, has advised “that its sole concern here, in the context of its responsibilities under the Shipping Act, is to insure that the finality of its determinations is preserved and that its factual findings will not be litigated long after the statutorily prescribed time for judicial review has run and in proceedings to which it is a stranger.” This was the precise objective of our decision. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/8883794. Public record. Not legal advice.