Petition — AMERICAN BAKERS ASS'N. v. UNITED STATES AND ICC (Nos. 76-1870, 76-1721, 1795, 77-24)

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Supieme Court, U. &

FILED

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IN THE

Supreme Court of the United States

Ocroper Term, 1976

No, 76°1870

AMERICAN BAKERS ASSOCIATION, Petitioner,

Tue Unirep States oF AMERICA and Tue INTERSTATE

COMMERCE COMMISSION, Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

EIGHTH CIRCUIT

Jacon P, Bruiia

Joun R, ATTANASIO

2033 K Street, N.W.,

Washington, D.C. 20006

(202) 223-8270

Counsel for American

Bakers Association

Press or Bynow 8S. Avames Praiwrine, Inc,, Wasntneron, D, C.

————

INDEX

Page

OPIMIONS BRLOW .icicssessssrcneereresereeeneneeee 2

JURISDICTION voc ccceerccereeereveeveeeereveeeneeens 2

QUESTION PRESENTED .....0 606s c cece eee renee eee ene 2

STATUTB INVOLVED coi sse ssc nssecvcerecsvcneneens 8

STATEMENT OF THR CABE 0... cece cree eee ee eens 4

Reasons ron Grantino tHe Wart or Certionant ..,... 10

I, The Court Of Ae peals Has Decided A Federal

Question In A Way Which Conflicts With The

Applicable bostsions Of This Court, ......0055 10

II, The Decision Of The Court Of Appeals Is In Con.

fliot With, And In Effect Nullifies, A Section Of

The Interstate Commerce Aot, .cccccccccccccas 20

SED vis acdeeeeeeceéukes cede eceescscecérce 22

PE TL disc ene ch akimeseits eceeebisaeneonsedée a-]

CED EEE NS A NAN DREN Rte OE b-1

eels Be ae i eee a ale ee soa |

ee os d-1

pe Fe eae err re nr me e-1

SEE OF ss cctiddubsbin eieeei cee euiadnddedccaés f.1

TABLE OF AUTHORITIES

Cases:

American Barge Line Co, v. Alabama G.S.R, Co., 303

1.0.0, 463 (1958), rev'd in ¥ at on other grounds,

806 1.0.0, 167 (1058), aff'd, 194 F.Supp. 438 (D.

SE SED bocdauenes eins unsoeddteseseedéodeces

Chicago & N. W. Ry. Co. v. Osborne, 52 F. 912 (8th

ee ST a cauaedbeks ovedendisbcecedesnedenase 12

il Table of Authorities Continued

Page

Cooperative Grange League Fed, Exc, v. Akron, 0, &

Y. R. Co., 8238 L.C.0, 174 (1964) oo... cece eeees 5

Grain Proportionals, Ex-Barge to Official Territory,

246 1.0.0, 853 modified, 248 LOC, 307 (1941),

rev'd sub nom, Inland Waterways Corp. v. United

States, 44 Da 868 (N.D, Ill, 1942), rev'd, 319

Grain Proportionals, Ex-Barge to Official Territory,

262 LCC, 7 (1945), rev’d sub nom, Mechling vy.

United States (N.D, Ill, Nov, 26, 1945), aff’d, 330

as GE. GED bvoceddeservedeeceubesedesnctes 16

Great Northern Ry. Co, v. Sullivan, 294 US, 458 sary

4, 11,12

Interstate Commerce Commission v, Inland Waterways

Corp., 819 U.S. 671 (1948) ....ccvevcvvevevess passim

Interstate Commerce Commission v, Mechling, 330 U.S.

GOT CRUG) cccccvccescccscccvcnceccoececces passim

James McWilliams Blue Line v. Campbell's Creek

Railroad Company, 278 L.C.C, 312 (1950), rev'd,

100 F.Supp. 66 (S.D.N.Y, 1951), aff'd per curiam,

342 US, 961 DD <isciaserersecndiaseenesos 18

James McWilliams Blue Line v, United States, 100 F.,

— 66 (S.D.N.Y, 1951), aff’d per curiam, 342

TN 1. voddickes oes enuceuaas seeds passim

Kentucky & Indiana Bridge Co. v. Louisville & N, R.,

Co,, 87 F. 567 (D. Ky. 1889), app. dismissed, 149

ee GEE Son dnvcucedovesdecesddesestisse 13

Omaha Grain Exc, v. Chicago, B. dQ. R. Co., 822 LOK,

743 (1964), rev'd 242 F.Supp. 414 (N.D, Ill. 1965),

aff'd per curiam, 382 U.S, 422 (1966) ............ 4

Parsons v. C, &@ N, W, Ry. Co., 167 U.S, 447 (1897) ... 12

Routing Restrictions Over Seatrain Lines, Inc., 296

SN ED 6 d0ccduducaseteeceneseness sees 11

Southwestern Missouri Millers’ Club v. St. L. & 8. F.

R. Co., 20 1.0.0. 98 (1914) ...cccccccccccseves 12

Tewas & P, Ry. Co. v. Interstate Commerce Commis-

Se Se EE n.dn'es scdcdcdecctccoces 12

Union Pac, R, Co, v, United States, 117 U.S, 355 (1886) 13

Table of Authorities Continued iii

Page

STATUTES :

Interstate Commerce Act

Bostion 1, UG. G1 ccccccccccccvccvcvccvens 4

Section 2,49 U.G.0.92 ....cccssevveveevveees passim

Seotion 3(1), 49 U.S.C. § B(1) occ ccc cece ween eee 4

Section 3(4), 49 U.S.C. § B04) ccc cc cece cece ees 6, 14, 17

Seotion 6(11)(b), 49 U.S.C, § 6(11)(b) «0.0.6 passim

Section 15(3), 49 U.S.C. § 1903) occ cece eee 16

Section 307(d),49 U.S.C. §907(d) ccc cece cues 16

Judicial Code

as a ss caeaes 2

i Lovucesnedeeneeee 4

Dy WE, EE cons ctovecevecsedcesecesens |

eh ieee esr eeuanenges 2

IN THE

Supreme Court of the United States

OcToBER TERM, 1976

No.

AMERICAN BAKERS ASSOCIATION, Petitioner,

THE UNITED STATES OF AMERICA and THE INTERSTATE

COMMERCE COMMISSION, Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

EIGHTH CIRCUIT

Petitioner, American Bakers Association, respect-

fully requests that a writ of certiorari issue to review

the judgment of the United States Court of Appeals

for the Eighth Circuit in The Atchison, Topeka and

Santa Fe Railway Company et al. v. The United States

of America, and The Interstate Commerce Commission,

No. 76-1198.

OPINIONS BELOW

The opinion of the Court of Appeals is reported at

549 F.2d 1186 (Appendix A, infra, pp. a-1 et seq.) ;

the order of the Court of Appeals denying petitions of

petitioners and intervenor-petitioner for rehearing

(Appendix B, infra, p. b-1) was not reported. The

decision of the Interstate Commerce Commission (Ap-

pendix C, infra, pp. c-1 et seq.) was not reported; the

initial decision of the Administrative Law Judge which

it affirms (Appendix D, infra, pp. d-1 et seq.) was not

reported.

JURISDICTION

The judgment of the Court of Appeals was entered

on February 24, 1977 (App. A, p. a-2) and an order

denying a timely petition for rehearing was entered

on March 31, 1977 (App. B, p. b-1). The jurisdic-

tion of this Court is invoked under 28 U.S.C. §§ 1254

(1) and 2350(a).

QUESTION PRESENTED

Common carriers by railroad have no statutory duty

to establish through routes or through rates with com-

mon carriers by motor vehicle, and the Interstate Com-

merce Commission (‘‘Commission’’) has no authority

to require the establishment of through routes between

such carriers or to prescribe rail proportional rates

applicable to shipments having a prior or subsequent

movement by motor carrier. Pursuant to the Trans-

portation Act of 1940, common carriers by railroad

have a statutory duty to establish through routes with

each other and with common earriers by water and

may be required to do so by the Commission. The Com-

mission also has authority, antedating the 1940 Act, to

prescribe rail proportional rates applicable to ship-

ments which may move by rail and water between any

two points in the United States.

In the instant case, the involved eastern railroads

(operating between Chicago and eastern points) have

not established through rates with motor carriers for

the movement of wheat from country origins to east-

ern inations via transit stops for processing in

Chicago. They have, however, established through

rates with other railroads and with common carriers

by water for such movements and have published pro-

portional rates, as their division of the through rates,

for the rail transportation service performed between

Chicago and eastern destinations. The question pre-

sented is whether the maintenance of proportional rates

applicable only as part of the through rates so estab-

lished, and lower than corresponding local rates ap-

plicable to wheat arriving by motor carrier at Chicago,

is a per se violation of Section 2 of the Interstate Com-

merce Act.

STATUTE INVOLVED

Section 2 of the Interstate Commerce Act (49 U.S.C.

§ 2) provides:

‘“*§2. Special rates and rebates prohibited.

If any common carrier subject to the provisions

of this chapter shall, directly or indirectly, by any

special rate, rebate, drawback, or other device,

charge, demand, collect, or receive from any per-

son or persons a greater or less compensation for

any service rendered or to be rendered, in the trans-

portation of passengers or property, subject to the

provisions of this chapter, than it charges, de-

mands, collects, or receives from any other person

or persons for doing for him or them a like and

contemporaneous service in the transportation of

a like kind of traffic under substantially similar

circumstances and conditions, such common car-

rier shall be deemed guilty of unjust discrimina-

tion, which is prohibited and declared to be un-

lawful.”’

STATEMENT OF THE CASE

This case arose pon a complaint filed with the In-

terstate Commerce Commission by the Board of Trade

of the City of Chicago against the eastern railroad pe-

titioners below. To the extent at issue herein, the com-

plaint alleged essentially that the maintenance of pro-

portional rates* by the railroads on outbound move-

ments of wheat and wheat products from Chicago to

eastern destinations, which applied in the case of wheat

which had arrived at Chicago from country origins by

rail or water carrier on interstate rates but not in the

case of wheat arriving at Chicago by motor carrier, was

unlawful. Complainants alleged that the railroads’

refusal to apply the lower proportional rates to such

motor carrier-arrived wheat, applying instead the

higher local rates applicable to all shipments of wheat

or wheat products deemed to originate at Chicago, was

violative of Sections 1, 2, and 3(1) of the Interstate

Commerce Act (‘‘ Act’’) 49 U.S.C. §§ 1, 2, and 3(1).

The rail rate structure complained of herein has

been maintained in virtually the same form for ap-

* A proportional rate is a carrier’s division of a through rate

charged for through transportation over a through route and may

be used only as such. Great Northern Ry. Co. v. Sullivan, 294 U.S.

458 (1935). See Grain Proportionals, Ex-Barge To Official Terri-

tory, 246 1.C.C. 353, 370, modified, 248 I.C.C. 307 (1941), rev’d

sub nom. Inland Waterways Corp. v. United States, 44 F.Supp.

368 (N.D. Til. 1942), rev’d, 319 U.S. 671 (1943), and cases cited

therein. A proportional rate is dependent for application upon

(1) a previous transportation to the point from which it applies,

(2) a subsequent transportation from the point to which the

proportional rate applies, or (3) both. Omaha Grain Exc. v.

Chicago, B. & Q. R. Co., 322 1.C.C. 743, 747 (1964), rev’d on other

grounds, 2A2 F Supp. 414 (ND. Ill. 1965), aff’d per curiam, 382

U.S. 422 (1966). |

proximately 70 years. See Cooperative Grange League

Fed. Exc. v. Akron, C. & Y. R. Co., 323 1.C.C. 174, 179-

82 (1964). Eastern railroads have, throughout that

time, maintained proportional rates applicable as part

of all-rail through rates from country origins beyond

Chicago to the eastern destinations. The through rates

thus established as combinations of local and propor-

tional rates are for the purpose of equalizing the

through rate from country origins to eastern destina-

tions as between grain which is shipped direct from the

farm and grain which is stopped in transit for storage

or processing. In American Barge Line Co. v. Ala-

bama G.S.R. Co., 303 I.C.C. 463, 466 (1958), rev’d

in part on other grounds, 306 1.0.C. 167 (1959), aff’d,

194 F.Supp. 438 (D.Kan. 1961), the Commission said:

The consumption of grain is nationwide, but its

greatest production is concentrated in limited sur-

plus areas which com with each other for sale

of the grain in the deficit markets of the East and

South. While the demand for grain is constant

throughout the year, it is marketed principally

during the first 2 or 3 months after harvest. At

that time the surplus grain must be collected and

stored at convenient locations, from which it is

released throughout the remainder of the year as

the demand arises. The grain while in storage

must be free to move out in competition with grain

still on the farm and with other stored grain at no

disadvantage in rates. This made necessary the

elaborate transit and rate equalizations found in

the present railroad grain-rate structures. These

rate structures were evolved over the years as a

result of experience and litigation before this

Commission and the courts. They are fully ex-

plained in our reports and in the western and

southern grain cases, 205 1.0.C. 301, 215 I.CC.

83, and 259 I.C.C. 629.

The eastern railroads have not established through

routes with motor carriers nor maintained propor-

tional rates applicable to outbound movements of grain

which arrive in Chicago by motor carrier.

In support of the arsailed rate structure, the rail-

roads relied principally on the holding of this Court in

Interstate Commerce Commission v. Inland Waterways

Corp., 319 U.S. 671 (1943). In that case, where rail-

roads maintained proportional rates for transportation

from Chicago to eastern destinations applicable to grain

arriving at Chicago by rail or lake vessel, which rates

were lower than the local rates applied by the rail-

roads for the same transportation service provided for

all other shipments, including those arriving by barge

at Chicago, this Court held that the rate disparity was

not per se unlawfully discriminatory under Section 2

of the Interstate Commerce Act.

The Ohicago Board of Trade urged that the holdings

of Interstate Commerce Commission v. Mechling, 330

U.S. 567 (1947), and James McWilliams Blue Line v.

United States, 100 F.Supp. 66 (S.D.N.Y. 1951), aff’d

per curiam, 342 U.S. 951 (1952) were controlling.

Mechling was a case arising after Inland Waterways

and after the Commission, pursuant to its authority

under Section 6(11)(b) of the Act, 49 U.S.C. § 6(11)

(b), prescribed rail proportional rates applicable to

grain arriving by barge at Chicago which were

higher than the corresponding proportional rates for

ex-rail or ex-lake grain. This Court held in Mechling

that a disparity between such proportional rates, in

the absence of a justification based on cost of services,

violated Section 3(4) of the Act, which prohibits dis-

crimination against the traffic of a connecting carrier,

and also violates Section 2 of the Act, which prohibits

railroads from charging one person more than another

for a “‘like and contemporaneous service in the trans-

portation of a like kind of traffic under substantially

similar circumstances and conditions... .’’ The deci-

sion in Blue Line, under similar facts, followed

Mechling.

After hearing, the Administrative Law Judge found

(App. D, p. d-30) that: |

[I]t makes no difference to the Eastern Rail-

roads how the wheat arrived at the elevator or

mill. Their service is exactly the same on the

Ohicago-to-the-east move whether the wheat ar-

rived at the mill or elevator by rail, water or truck

and thus the costs are the same.

Solely on the basis of that finding, that the costs to the

eastern railroads for the physical handling of motor

carrier-arrived wheat was the same as their costs for

the handling of rail-arrived and water-arrived wheat,

the Administrative Law Judge concluded that he was

bound by the results in Mechling and Blue Line and

that the rate differential constituted a per se violation

of Section 2 of the Interstate Commerce Act.

The Administrative Law Judge made no findings

contrary to the position of the railroads that they

maintained through routes with the inbound rail and

water carriers involved in the through movement of

grain, nor was any issue raised as to the long-standing

view that stops in transit for the processing of wheat

and other grain do not interrupt the through character

of “ach movements. The conclusions and findings of

the .dministrative Law Judge, adopted by the Com-

mission as its own (App. C., p. c-2), were thus premised

exclusively on the existence of a differential between

the involved local and proportional rates for the same

physical handling of shipments without a demonstrated

difference in costs to the eastern railroads, The exis-

tence of through routes and the nature of the propor-

tional rates as divisions of through rates applicable

over such routes was not contested. T

The railroads sought judicial review of the Com-

mission’s decision before the United States Court of

Appeals for the Eighth Circuit pursuant to 28 U.S.C,

§§ 2321(a) and 2342(5), As had the Commission, the

Court of Appeals determined that the case was con-

trolled by Mechling and Blue Line. It thus held that

the rate differential at issue was unlawfully discrimi-

natory as a matter of law under Section 2. The Court

of Appeals concluded (App. A, p. a-10):

We reject sey 1 mye characterization of Mech-

ling and Blue Line as being limited to barges or

peneparnene between through rates. Rather, we

read those cases to hold that different rates may

not be charged similarly situated shippers for

the same service, based on the mode of transpor-

tation used in a ro or subsequent movement,

where the cost of providing the service is the

same. In view of the conceded similarity in

costs and circumstances in this case, Mechling and

Blue Line compel a finding of discrimination un-

der section 2, Petitioners’ argument that the

truck-rail transportation of grain is a local move-

ment whereas the rail-barge, lake-rail movement.

is a through movement is beside the point. Cf.

ICC v. Mechling, supra, 330 U.S, at 577.

At the same time, the Court of Appeals, somewhat

equivocally,’ stated (App. A, p. a-10):

* In a final, catch-all finding, the Court of Appeals said, ‘‘In

any event, to the extent that Inland Waterways is inconsistent

with Mechling and Blue Line, we are bound by the Supreme

Court's latest pronouncements as reflected in the latter [footnote

omitted].’’ (App, A, pp. a-10- a-11.)

We do not view Inland Waterways as being

inconsistent with Mechling and Blue Line.

It justified this view on the basis that (/d.):

In that case [Inland Waterways] the petitioners

focused more on the origin of the grain as the

basis of the discrimination than on the mode of

transportation into Chicago.

The view is simply not supported by this Court’s

statement of the facts in Inland Waterways, 319 U.S.

at 673-76,

The Court of Appeals denied petitions for rehear-

ing filed by petitioners and intervenor-petitioner

below. (App. B, p. b-1.)

Petitioner American Bakers Association (ABA),

an intervenor-petitioner in the case before the Oourt

of Appeals below, is a trade association comprising

over 300 member companies which produce and dis-

tribute bread and bakery products throughout the

United States. ABA members operate bakeries in

forty-nine states and have a combined output of ap-

proximately 70 percent of the nation’s total bakery

production. The principal ingredient of the bread

and other bakery products produced by the ABA

members is wheat flour, one of the commodities to

which the involved rates apply. The annual freight

bill of all of the ABA members for the railroad move-

ment of wheat flour exceeds 175 million dollars. ABA

members also utilize the nation’s railroads for the

movement of numerous other commodities, including

lard, corn sugar, beet sugar, cane sugar, shortening,

and corn starch.

Following the Commission’s decision herein, the

railroads concluded that the alleged unjust discrimi-

nation could be cured only by cancelling all propor-

tional rates on movements of grain from Chicago to

eastern destinations and announced a formal tariff

proposal to that effect. It is estimated that such can-

vellation of the proportional rates applicable to the

wheat flour movements of ABA members would add 20

million dollars annually to the transportation costs of

the ABA members. The railroads’ proposed cancel-

lation was held in abeyance when the effective date

of the Commission's order herein was stayed pending

completion of judicial review of the Commission’s deci-

sion. ABA’s participation in these proceedings is

thus for the purpose of protecting the interests of its

members in preserving the benefits of the rail propor-

tional rates now available to them,

REASONS FOR GRANTING THE WRIT OF CERTIORARI

The Court Of Appeals Has Decided A Federal Question In A

Way Which Conflicts With The Applicable Decisions

Of This Court.

The Court of Appeals based its decision in these pro-

ceedings on the erroneous view that this Court’s deci-

sion in Mechling, and its per curiam affirmance in

Blue Line, are dispositive of the issue presented, In

so doing, it declined to follow this Court’s decision in

Inland Waterways, a case which is squarely in point,

whose continuing validity has never been questioned

by this Court, and which is clearly distinguishable

from the eases which the Court of Appeals found to

be the ‘latest pronouncements’’ of this Court on the

issue at hand,

The substantive issue presented to the Court of Ap-

peals was whether, as a matter of law, the application

of a proportional rate by a railroad to shipments of

wheat over its line, when such wheat arrives by rail or

water carrier at the point of interchange, is unlaw-

fully discriminatory under Section 2 of the Interstate

Commerce Act when the railroad applies no propor-

tional rate, but only its higher local rate, to similar

shipments tendered to it for transportation between

the same points on its line after arrival by motor

carrier, It should be emphasized at the outset that

the rate differential alleged to be discriminatory

herein is not a differential between proportional rates

applicable over a common rail leg of two coterminus

through routes as was the case in Mechling and Blue

Line. The differential under attack is one between a

proportional rate, on the one hand, maintained as part

of a through rate for traffic moving on a through

route* from a point on one carrier’s line to a point

on another carrier’s line, and a local rate, on the

other hand, applicable to shipments to which no

‘‘*A through route is an arrangement, express or implied,

between connecting carriers for the continuous carriage of goods

from an origin on the line of one carrier to a destination on

the line of another. The establishment of a through route re

quires the maintenance also of reasonable through rates... . No

formal agreement is necessary. The through route need not be

specified in the tariff. A joint rate is not needed; a combina-

tion of separately established factors is sufficient.’’ Routing

Restrictions Over Seatrain Lines, Inc., 296 1.C.C, 767, 772, (1955).

The establishment of proportional rates restricted to traffle hav-

ing a prior movement over the line of a connecting carrier ‘‘nec-

easarily reflect{s] agreement, express or implied, between the

connecting carriers to establish a through route for continuous

carriage from origin on one to destination on the other.’’ Great

Northern Ry. Co. v. Sullivan, 294 U.S. 458, 460 (1935). The

establishment of proportional rates by the eastern railroads ap-

plicable to traffic having a prior movement by connecting rail-

roads from country origins to Chicago may thus be presumed to

reflect the establishment of through routes. No factual issue has

been raised below as to the existence of such through routes nor

has any factual showing been made which would tend to rebut

this presumption.

through rate applies and for which no through route

has been established, Contrary to the view of the Court

of Appeals, the question whether the two rates apply

for ‘‘exactly the same transportation service’’ provided

by the eastern railroads is not dispositive of the dis-

crimination question under Section 2. Rather, the ques-

tion which is required to be resolved is whether the

transportation service rendered by the eastern rail-

roads on local traffie and the service rendered on

through traffic are provided under ‘similar cireum-

stanees and conditions.’ The Court of Appeals, in

clear error, found that this critical question is ‘beside

the point’. (App. A, p. a-10.)

It has long been recognized that a carrier’s division

of a through rate, which is precisely what a propor-

tional rate is, Great Northern Ry. Co. y, Sullivan, 294

U.S, 458, 460 (1935), is not the basis on which the rea-

sonableness of that carrier’s local tariff for the same

services is determined, Chicago & N.W. Ry. Co. v.

Osborne, 52 F. 912 (8th Cir, 1892), and that a carrier’s

portion of a through rate may be less than its local

rate for the same services without thereby resulting

in an unjust discrimination, Parsons v. C. & N.W. Ry.

Co., 167 U.S. 447 (1897); Texas & P, Ry. Co. v. Inter-

state Commerce Commission, 162 U.S. 197 (1896) ;

Southwestern Missouri Millers’ Club v. St. L. & S.F.

R. Co., 29 1.0.0, 28, 29 (1914). When carriers col-

laborate to establish a through rate, the through route

over which such rate applies is treated in effect as

‘‘a new and independent line.’’ Osborne, supra, at 914,

The ‘‘cireumstances and conditions’ attending the

movement of shipments over a portion of such a “new

and independent line’ by one of the participating

carriers are not the same “circumstances and condi-

———————————————

tions’’ attending the movement of shipments between

the same points by that carrier when the shipments

are first tendered at an intermediate point on the route

over which the through rate applies, Kentucky &

Indiana Bridge Co. v. Louisville & N.R. Co., 37 F’, 567,

632 (D. Ky. 1889), app. dismissed, 149 U.S, 777

(1893); see Union Pac, R. Co, v. United States, 117

U.S. 355 (1886). The rendering of identical transpor-

tation services with respect to through traffic and local

traffic, therefore, in no way suggests that the ‘cireum-

stances and conditions” attending the movement of

the two descriptions of traffic are ‘substantially

similar,”’

The longstanding recognition which has been given

the validity of proportional rates lower than corre-

sponding local rates was affirmed by this Court in

Inland Waterways, the only case decided by this Court

which construes Section 2 of the Act as it applies to

a rail carrier’s determination to establish proportional

rates only for traffic having a prior movement by a

particular mode on interstate rates while regarding

all other traffic as local traffic and maintaining higher

local rates applicable thereto, Rather than follow

Inland Waterways, however, the Court of Appeals

either determined that the case had been implicitly

overruled or it misread the case as being factually

distinguishable from the instant case.

In Inland Waterways, the Commission had refused

to suspend certain amendments to railroad tariffs

which terminated the application of proportional rates

to ex-barge shipments of grain for reshipment from

Chicago to eastern destinations. The amendments re-

quired the application of the railroads’ local rates to

such shipments, just as such local rates were applic-

able to any other shipments deemed to originate at

Chicago, The change, in effect, terminated the through

routes which had previously existed, as implied by the

maintenance of through rates and facilities for imter-

change, over the lines of the rail and barge carriers.

The Oommission upheld the termination of propor-

tional rates for ex-barge traffic against the claim of

the barge operators that the maintenance of different

local and proportional rates applicable to the identical

physical handling of shipments by the involved rail-

roads was an unlawful discrimination under Section 2

of the Act. The Commission at the same time recog-

nized that, in ‘‘a proper proceeding’’, it could and

would entertain a proposal by the barge operators

that the Commission prescribe proportional rates ap-

plicable on the rail portion of the ex-barge movements

of grain.* Upon reconsideration, and despite the urg-

ings of the barge carriers that the newly enacted

Transportation Act of 1940 (which, under Section

3(4) of the Act, prohibited discrimination by rail-

roads against the traffic of ‘‘connecting carriers’’, a

term defined to include railroad and water carriers),

required a different result, the Commission upheld

its earlier determination on the basis that the pro-

testing barge operators had not offered any evidence

or made any proposal for the establishment of pro-

portional rates for the ex-barge rail movements,

a ee

‘Under Section 6(11)(b) of the Act, 49 U.S. 66°" \b), the

Commission has authority to prescribe pr oruonal — rates

applicable to traffie which may move by rail and water common

carriers between points in the United States. This provision ante-

dates the regulation of common carriers by water provided for in

the Transportation Act of 1940 and does not require for its opera-

tion that the involved water carrier hold any particular status

under any regulatory legislation.

While the specially constituted three-judge district

court enjoined the Commission’s order vacating the

already-expired suspension of the proposed tariffs,

this Court reversed the decision of the district court.

The Court held that proportional rates lower than

local rates for the same transportation service are not

per se unlawful under Section 2 of the Act, as was

contended by the barge operators. The Court said

(319 U.S. at 684-85) :

Proportional rates so differing and lower than

local rates for like outbound transportation have

a long history, antedating the Interstate Commerce

Act itself. Long hauls have generally been thought

entitled to move at a rate less than the sum of the

rates for local or short hauls between intermediate

points. The practice of routing commodities such

as grain to centers for marketing and processing

has been widespread and often a necessary fea-

ture of the process of distribution. In many in-

stances stopovers for marketing and processing

have not been considered as disrupting the con-

tinuity of transportation to move distant points,

and consequently the grain has been allowed to

move on at a rate lower than the ou*ound rate

on grain originating locally and not from a dis-

tance. To get the outbound business competing

earriers frequently would offer rates similarly

computed. Proportional rates established on this

reasoning have become deeply embedded in the

transportation system of the country, and have

been approved by the Interstate Commerce Com-

mission, by the federal courts, this one included;

and, so far as it has spoken on the subject, by Con-

gress itself. We see no reason for repudiating

them now. [Footnotes omitted. ]

At the same time, the Court recognized, as had the

Commission, that the claim of discrimination under

Section 2 could be viewed in quite a different light if

the Commission were to exercise its statutory author-

ity under Section 6(11)(b) to prescribe rail propor-

tional rates applicable to the ex-barge traffic. It noted,

however (319 U.S. at 690-91), that:

The issue raised by the position of the parties did

not eall for a fixing of new combination rates, for

it was contended barge grain was entitled to the

existing proportionals.

In the Mechling case the issue presented to the Court

was distinetly different from that presented in Inland

Waterways. Following the Inland Waterways deci-

sion, the Commission did institute a “proper proceed-

ing’’ to determine whether, under Section 6(11)(b),

it should prescribe rail proportional rates for the same

ex-barge shipments of grain involved in Inland Water-

ways. Grain Proportionals, Ex-Barge to Official Ter-

ritory, 262 I.C.C. 7 ( 1945), rev’d sub nom. Mechling

v. United States (N.D. Tll., Nov. 26, 1945), aff’d, 330

U.S. 567 (1947).5 The Commission concluded that

proportional rates should be prescribed, but it also

coneluded that ex-barge proportionals may properly

vary from the ex-rail and ex-lake proportionals to the

extent warranted by differences in competitive cir-

cumstances attending the through movements by dif-

fering modes. 262 1.0.C. at 27. This Court, on appeal

from the decision of a three-judge district court which

enjoined enforcement of the Commission’s order to

the extent that it permitted a variance between the

proportional rates preseribed for ex-barge traffie and

'The Commission in the same proceeding also considered

whether joint barge-rail rates should be prescribed under its then

recently-enacted authority provided in Sections 15(3) and 307(d)

of the Act, 49 U.S.C. §&§ 15(3)and 907(d). It was agreed by the

parties and coneluded by the Commission that no such joint rates

should be prescribed. (262 1.C.C. at 10, 32.)

the proportional rates applicable on ex-rail and ex-

lake traffic, was thus faced solely with the issues of

whether the Commission may lawfully prescribe, or

the railroads lawfully maintain, proportional rates ap-

plicable on ex-barge traffic as well as on ex-rail and

ex-lake traffic which vary as between the ex-barge

traffic, on the one hand, and the ex-rail and ex-lake

traffic, on the other.*

In Mechling, then, where varying proportional rates

had been prescribed for the common rail segment of

eoterminus through routes, such variance based solely

on the mode of the prior movement by a statutory con-

necting carrier, this Court held, first, on the basis of

the Section 3(4) prohibition of discrimination against

the traffic of a connecting carrier and, secondarily, on

the basis of the Section 2 prohibition against rate dis-

crimination for ‘‘a like and contemporaneous service of

a like kind of traffic under substantially similar cir-

cumstances and conditions,” that the differential be-

tween the two sets of proportional rates was unlawful.

‘‘Similar cireumstances and conditions’? could be

found to exist for the common rail movements because

through rates had been established for both movements.

This had not been the case in Inland Waterways.

The Blue Line case, also cited by the Court of Ap-

peals as compelling its decision herein, correctly fol-

lowed Mechling but, like Mechling, is inapposite in the

instant case. In terms of further exposition of the

circumstances which constitute a per se violation of

Section 2, it stands only for the proposition that a rail-

® With respect to the Commission’s decision that proportional

rates should be preseribed, the Court noted (330 U.S. at 572)

that, ‘‘This part of the Commission’s order has not been chal-

lenged’’. There was, moreover, no question whether the Com-

mission had the authority to prescribe rail proportional rates.

road’s publication of proportional rates at differing

levels for the same physical handling of shipments is

unlawful when the difference is based on the mode of

transportation employed in a subsequent movement

just as it was in Mechling when based on the mode

employed in a previous movement.

In Blue Line, the so-called ‘‘Pocohontas Railroads”’

operating from the coal mines of Virginia, West Vir-

ginia and Kentucky to the Hampton Roads ports had

established proportional rates for coal moving over

their lines to the Hampton Roads ports and subse-

quently by ocean to New England ports and finally by

either rail or barge to interior points. The propor-

tional rates applicable when the final leg was by barge

were higher than the proportional rates which applied

when the final leg was by rail. Both sets of rates, how-

ever, were proportional rates. James McWilliams

Blue Line v. Campbell’s Creek Railroad Company, 278

[.0.C, 312, 313 (1950), rev’d, 100 F.Supp. 66 (S.D.

N.Y. 1951), aff’d per curiam, 342 U.S. 951 (1952).

Thus the three-judge district court correctly noted

that:

The only factual difference between the M echling

case and the case at bar is that in the Mechling

ease the rates charged for rail transportation were

dependent upon the means used to accomplish the

prior movement of the shipment while here the

rates are made dependent upon the means used to

accomplish the subsequent movement of the ship-

ment.

Moreover, as in M echling, while the Commission

could not regulate ‘‘Blue Line’s” barge rate under

Part III of the Act, as the district court noted (100

F.Supp. at 70), that fact did not preclude the decision

reached, first, because the railroads had established

proportional rates, and because, in any event, the Com-

mission had the authority, under Section 6(11) (b), to

prescribe the establishment of rail proportional rates

despite its lack of Part III jurisdiction over the barge

(and ocean) carriers. While the district court noted

that the decision in Mechling was reached independ-

ently of the Commission’s jurisdiction over barge car-

riers, the result was not reached independently of the

fact that proportional rates had been, established ; they

were established by the Commission ’s action under its

Section 6(11) (b) authority. In Blue Line, then, where

the railroads had by their own actions voluntarily es-

tablished proportional rates for the two coterminus

through routes, the existence of differing proportional

rates applicable for the same portion of those through

routes likewise required a finding of a discrimination

under Section 2 because the relevant ‘‘circumstances

and conditions’’—those relating to the through rate—

were the same.

In the instant case, the involved railroads and motor

earriers have clearly not established through routes or

through rates by any voluntary action. Moreover, in

the barge cases on which the Court of Appeals has

relied, the Commission had authority to prescribe rail

proportional rates, applicable in connection with water

carrier movements. It has no analogous authority in

this case. The instant case, therefore, is in a posture en-

tirely different from that of Mechling and Blue Line

eases. The relevant ‘‘cireumstances and conditions”’

to be compared herein are those relating to a through

rate on the one hand and a local rate on the other hand.

These ‘‘circumstances and conditions’’ are clearly dif-

ferent inasmuch as a long haul is involved in the case

of the proportional rates while a short haul is involved

in the case of local rates. Nevertheless, the Court of

Appeals refused to consider this fact in reaching its

decision.

In summary, the question whether a railroad may

maintain proportional rates for traffic moving on

through routes which it has established while at the

same time maintaining local rates for all other traffic,

including that for which the railroad may not be re-

quired to establish through rates, has been clearly and

correctly resolved in the affirmative by this Court in

Inland Waterways, and the validity of that resolution

has never been questioned by this Court nor otherwise

disturbed by either Mechling or Blue Line. The fail-

ure of the Court of Appeals to follow Inland Water-

ways in deciding the question before it is thus a com-

pelling reason for the writ of certiorari to issue in this

case.

The Decision Of The Court Of Appeals Is In Conflict With,

And In Effect Nullifies, A Section Of The Interstate Com-

merce Act.

Section 6(11) is the only section of the Interstate

Commerce Act which expressly mentions proportional

rates. It provides that, when property may be or is

transported in interstate commerce by rail and water

between points in the United States by common car-

rier, the Commission shall have jurisdiction over both

the rail and water carriers and shall have jurisdiction:

(b) To establish proportional rates, or maximum,

or minimum, or maximum and minimum propor-

tional rates, by rail to and from the ports to which

the traffic is brought, or from which it is taken by

the water carrier, and to determine to what traffic

and in connection with what vessels and upon what

terms and conditions such rates apply. By pro-

portional rates are meant those which differ from

the corresponding local rates to and from the port

and which apply only to traffic which has been

brought to the port or is carried from the port by

a common carrier by water.

te ern oat

The statute thus expressly contemplates a disparity

between rail proportional rates prescribed by the

Commission when prior or subsequent water move-

ments are involved and rail local rates applicable to all

other rail movements between the same points on

which the proportional rates apply. The Court of Ap-

peals decision is in direct conflict with this statutory

recognition that a disparity between proportional and

local rates may exist and, in fact, may be required,

irrespective of whether there is any difference in the

cost of providing the involved service.

In ignoring the position of the railroads that through

traffic, to which proportional rates apply, and local

traffic, to which local rates apply, are not handled un-

der ‘‘similar circumstances and conditions,’’ the Court

of Appeals held flatly that, in the absence of a differ-

ence in costs, Section 2 prohibits any disparity in rail

rates applicable between the same points when the in-

volved traffic is moving, by whatever mode, from the

same ultimate origins to the same destinations. If the

decision of the Court of Appeals is not reversed, it

would effectively tie the hands of the Commission in

its exercise of its Section 6(11)(b) authority to estab-

lish ex-water proportional rates which, in the words

of the statute, ‘‘differ from the corresponding local

rates to and from the port and which apply only to

traffic which has been brought to the port or is carried

from the port by a common carrier by water.’”’ Thus,

while the Commission is expressly authorized by Sec-

tion 6(11)(b) of the Act to prescribe certain propor-

tional rates, if it should do so, the resulting rate

structure could, following the Court of Appeals deci-

sion, be found per se unlawful under Section 2 solely

on the basis of a showing that traffic similar to that to

which the prescribed proportional rates apply may

also move by motor-rail or rail-rail combinations be-

tween the same points in the United States. Such a

showing would clearly be possible in most eases. The

Court of Appeals decision would, in effect, strip the

Commission of the authority which Section 6(11) (b)

expressly provides,

The Court of Appeals decision is thus not only in

direct conflict with the statutory definition of a pro-

portional rate set forth in Section 6(11)(b), the sole

mention of such a rate made in the Interstate Oom-

merce Act, but also actually nullifies the proportional

rate prescription power granted to the Commission

therein. A decision which has such effects clearly is

required to be considered by this Court.

CONCLUSION

It is respectfully submitted that the decision of the

Court of Appeals is plainly in error, that it conflicts

with an applicable decision of this Court, and that it

requires a construction of the Interstate Commerce

Act which conflicts with its plain meaning. For all of

the foregoing reasons, the present petition for a writ of

certiorari should be granted.

Respectfully submitted,

Jacosp P, Bria

JoHN R. ATTANASIO

2033 K Street, N.W.

Washington, D.C. 20006

(202) 223-8270

Counsel for American

Bakers Association

June 28, 1977

APPENDIX

1 a

ie Th ea i q & (few

r bo aS, - wt

yer ie cee re

APPENDIX A

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

No, 76-1198

THE ATCHISON, TOPEKA AND SANTA FE

RAILWAY COMPANY, THE BALTIMORE AND

On10 RAILROAD COMPANY, BURLINGTON

NORTHERN INC., THE CHESAPEAKE & Onto

RAILWAY COMPANY, CHICAGO & EASTERN

ILLINOIS RAILROAD COMPANY, CHICAGO,

MILWAUKEB, ST. PAUL AND PACiFic

RAILROAD COMPANY, CHICAGO AND NorTH

WESTERN TRANSPORTATION COMPANY,

CHICAGO SOUTH SHORE AND SOUTH BEND

RAILROAD COMPANY, CONSOLIDATED RAIL

CORPORATION, Denver & RIO GRANDE

WESTERN RAILROAD COMPANY, WILLIAM

GIBBONS, TRUSTEE OF CHICAGO, ROCK ISLAND

AND PAciFic RAILROAD COMPANY, DEBTOR,

GRAND TRUNK WESTERN RAILROAD Co.,

GREEN Bay & WESTERN RAILROAD Co., THE

KANSAS CITY SOUTHERN RAILWAY COMPANY,

LOUISVILLE AND NASHVILLE RAILROAD,

MIssOURI-KANSAS- TEXAS RAILROAD Co.,

Missouri Pacific RAILROAD COMPANY,

NORFOLK AND WESTERN RAILWAY COMPANY,

St. Louts-SAN FRANCISCO RAILWAY

COMPANY, ST. Louts SOUTHWESTERN

RAILWAY COMPANY, SOUTHERN PACIFIC

TRANSPORTATION Co,, Texas & PACIFIC

RAILWAY COMPANY, UNION PACIFIC

RAILROAD, THE WESTERN PACiFic RAILROAD

COMPANY,

Petitioners,

On Petition for

Review of

Orders of the

' Interstate

Commerce

Commission

AMERICAN BAKERS ASSOCIATION, ANHEUSER: |

Buscn, INC., THE BOARD OF TRADE OF

KANSAS City, Missouri,

Intervenors-Petitioners, | On Petition for

Review of

. Orders of the

c "Interstate

THe UNITED STATES OF AMERICA, °

Commerce

THE INTERSTATE COMMERCE COMMISSION, oor

Commission

Respondents,

BOARD OF TRADE OF THE CITY OF CHICAGO,

Intervenor-Respondent, |

Submitted: December 16, 1976

Filed: February 24, 1977

Before STEPHENSON and HENLEY, Circuit Judges, and

MEREDITH,® District Judge.

STEPHENSON, Circuit Judge.

Petitioners seek to review and set aside orders of the Interstate

Commerce Commission (ICC) declaring certain railroad rates

for the shipment of wheat eastward from Chicago to be unlaw-

fully discriminatory and directing that the discrimination be

removed. ' The principal issue before us is whether the Commis-

*The Honorable James H. Meredith, Chief Judge, United

States District Court for the Eastern District of Missouri, sitting

by designation.

‘The orders were entered in proceedings styled Board of Trade

of the City of Chicago v. The Akron, Canton & Youngstown R.R.

Co., et al., Docket No, 35825, We have jurisdiction pursuant to

28 U.S.C, §§2321(a) and 2342(5). Venue is proper in this court in

that several of the petitioning railroads have their principal offices

in this circuit, 28 U.S.C, §2343,

a-2

sion erred in finding the rates to be discriminatory as a matter of

law in violation of section 2 of the Interstate Commerce Act, 49

U.S.C, §2.’

This controversy centers around the dual rate structure main-

tained by the petitioning railroads for the eastward reshipment of

wheat originally shipped to Chicago from points west. Wheat

arriving in Chicago by rail, lake steamer or barge is treated as

having originated west of Chicago and is accorded a through or

proportional rate for reshipment to the east.’ Wheat arriving in

Chicago by motor carrier and reshipped to the east is treated as

having originated in Chicago and is charged a local rate. In 1973,

the proportional rate for wheat shipped from Chicago to New

York was 81.5 cents per hundredweight. The local rate for the

49 U.S.C. §2 provides:

If any common carrier subject to the provisions of this

chapter shall, directly or indirectly, by any special rate,

rebate, drawback, or other device, charge, demand, collect,

or receive from any person or persons a greater or less com-

pensation for any service rendered or to be rendered, in the

transportation of passengers or property, subject to the

provisions of this chapter, than it charges, demands, collects,

or receives fr.in any other person or persons for doing for

him or them a like and contemporaneous service in the trans-

portation of a like kind of traffic under substantially similar

circumstances and conditions, such common carrier shall be

deemed guilty of unjust discrimination, which is prohibited

and declared to be unlawful.

‘A through route is an arrangement between connecting car-

riers for the continuous carriage of goods from an originating

point on the line of one carrier to a destination on the line of

another. The sum of the charges for the entire movement is the

through rate. Each carrier's charge for its part of the through

movement is a portion of the through rate and is often referred to

as a proportional rate. See generally Thompson v. United States,

343 U.S. 549, 556-57 (1952); Routing Restrictions Over Sea-

train Lines, Inc., 296 1.C.C. 767, 772-75 (1955).

a-3

same movement was 98 cents. It is undisputed that the cost of ser-

vice to the railroads for the eastward transportation of wheat

from Chicago does not vary according to the manner in which the

wheat was shipped to Chicago. All wheat arriving in Chicago is

deposited in the same elevators and thereafter loses its identity.

In 1973, the Chicago Board of Trade filed a complaint with the

ICC, alleging, inter alia, that the dual rate structure as it affected

motor-carrier-arrived wheat at Chicago was unreasonable and

discriminatory, and thus in violation of sections 1, 2 and 3(1) of

the Interstate Commerce Act, 49 U.S.C, §§1, 2 and 3(1). The

matter was referred to an administrative law judge, who, after

hearings, found that the aforesaid rates were unjustly discrimina-

tory in contravention of 49 U.S.C. §2.‘ The hearing examiner

stated that his decision was compelled by /CC v, Mechling, 330

U.S. 567 (1947); and James McWilliams Blue Line, Inc. v. United

States, 100 F. Supp. 66 (S.D.N.Y. 1951), aff'd per curiam, 342

U.S. 951 (1952); cases which he viewed as indistinguishable from

the instant controversy. The railroads were directed to remove

the unlawful discrimination.

The hearing examiner’s decision was affirmed and adopted by

Division 2 of the Commission. Thereafter, petitioners sought and

‘The hearing examiner stated his findings as follows:

The Administrative Law Judge finds that the maintenance

of the assailed proportional or reshipping rates and charges

from Chicago, IIl., to points in the eastern United States, as

set forth in the defendant railroads’ tariffs, on wheat and

wheat products, in carloads, where the prior movement of

the commodities to Chicago is by railroad, lake vessel, or

barge, without maintaining like rates and charges, at the

same levels, and from and to the same points on the same

commodities where the prior movement to Chicago is by for-

hire motor carrier, is unjustly discriminatory in contraven-

tion of the provisions of section 2 of the Interstate Commerce

Act, and that the assailed rates and charges are not shown to

be otherwise unlawful.

a-4

were denied review by the full Commission. The Commission,

however, stayed the effective date of the relief ordered pending

the completion of judicial review. This petition for review, filed by

the affected railroads, followed.’

49 U.S.C. §2 prohibits carriers from charging different rates

for doing “like and contemporaneous service in the transportation

of a like kind of traffic under substantially similar circumstances

and conditions . . . .* Petitioners contend that wheat reshipped by

rail after arriving in Chicago by rail, barge or lake steamer is a

through movement,’ whereas wheat arriving by truck and re-

shipped by rail is a local movement. Based on that distinction, and

on the fact that the Interstate Commerce Act requires rail and

water carriers to establish through routes with each other, 49

U.S.C. §§1(4) and 905, but does not require those carriers to es-

tablish through routes with motor carriers,* petitioners argue that

the circumstances of truck-rail transportation on the one hand

and rail, barge, lake-rail transportation on the other are dis-

similar, and that section 2, therefore, does not require that the re-

spective rates be the same. They argue that Mechling and Blue

Line are inapposite in that those cases concerned barges and did

not involve the through-local distinction presented here, and that

the controlling case which mandates a finding of no discrimina-

tien is ICC v. Inland Waterways Corp., 319 U.S. 671 (1943). Re-

spondents urge that since the physical transportation of wheat

eastward from Chicago and tive cost thereof is the same regard-

‘We granted leave to intervene as petitioners to the American’

Bakers Association, Anheuser-Busch, Inc., and The Board of

Trade of Kansas City, Missouri; and leave to intervene as a re-

spondent to the Board of Trade of the City of Chicago.

°The text of 49 U.S.C. §2 is set forth at note 2, supra.

See note 3, supra.

‘Under 49 U.S.C. §316(c), establishment of such through

routes is permitted but not required.

a-5

less of the mode of transportation by which it arrived, the charac-

terization of one movement as through and the other as local is of

no consequence, and that the Commission properly declared the

rates to be discriminatory in accordance with Mechling and Blue

Line.

We turn to an examination of the cases urged by each side as

controlling.

Inland Waterways concerned the legality of railroad rates for

the reshipping of grain eastward from Chicago. The railroads

filed tariffs which applied proportional reshipping rates to grain

arriving at Chicago by rail or lake steamer, and local rates to

grain arriving by barge. In all cases, the local rates were higher

than the proportional rates. After hearings on the proposed

tariffs, the Commission sustained the rates, Stating in part:

Protestants maintain that the proposed schedules will be

unreasonable, unjustly discriminatory, and unduly prejudi-

cial .. . and unduly preferential. . . . This is based primarily

on the fact that under the proposed schedules the ex-barge

rates will be higher than the ex-rail or ex-lake rates, although

in each instance the physical carriage beyond the reshipping

point is substantially the same. But the latter is also true of

local grain, grain brought in by truck, or by rail under intra-

state rates, or grain which has forfeited its transit privileges.

To adopt protestants’ premise would mean that all propor-

tional rates lower than local rates and differing from each

other according to the origin of the commodity would have to

be condemned. As pointed out by the division, reshipping or

proportional rates are in their essence balances of through

rates. Such balances are, of course, determined by the mea-

sure of the in-bound and through rates, and properly may

vary according to the relative length and nature of the in-

bound and through service. It follows that the protestants’ al-

legations cannot be sustained in this proceeding, although in

a proper proceeding we might prescribe proportional! rates on

the ex-barge traffic lower than local rates or joint barge-rail

rates lower than the combinations.

319 US. at 681.

a-6

While the aforesaid Commission proceedings were pending,

Congress enacted the Transportation Act of 1940, which, inter

alia, conferred common carrier status on barge lines and required

that they and the railroads enter into reasonable through routes

with each other. 49 U.S.C. §§1(4) and 905. The barge lines

sought reopening of the hearings or reconsideration on that basis,

but were denied relief. Suit was then filed seeking to annul the

Commission’s approval of the new rates on grounds that the rates

unlawfully discriminated against barges. The district court grant-

ed relief, 44 F. Supp. 368; however, the Supreme Court reversed.

Mr. Justice Jackson, writing for the majority, stated in part:

In the proceedings before the Commission the protestants

pitched their case upon two propositions: (1) To deny the ex-

barge grain the benefit of proportionals sought to be can-

celled was necessarily unlawful since the physical carriage

beyond Chicago was substantially the same, no matter where

the grain originated; ... .

As the Commission corectly observed with reference to the

first contention, “to adopt protestants’ premise would mean

that all proportional rates lower than local rates and differ-

ing from each other according to the origin of the commodity

would have to be condemned.”

Proportional rates so differing and lower than local rates

for like outbound transportation have a long history, an-

tedating the Interstate Commerce Act itself. . . .

*_* *

To sustain the injunction would require a holding that grain

originating 60 miles from Chicago must as matter cf law be

given the benefit of proportionals fixed with reference to

grain from the Northwest Territory, embracing points in

Canada and as far west in the United States as Washington

and the Dakotas. In addition to the disparity in distances,

there is the further fact that the grain from the Northwest is

predominately wheat, while that from the territory served by

the barge lines is predominately corn from Illinois. Nothing

in the Interstate Commerce Act as amended by the Trans-

a-7

portation Act of 1940, or in the statements of even the most

ardent Congressional champions of water transportation,

affords the slightest warrant for a decision that the Commis-

sion must treat as legally identical such widely disparate fac-

tual situations.

319 U.S. at 683-88.

The Court noted that it viewed neither the Commission’s action

nor its own as an approval of the then-existing rates, but rather as

a determination that “the proposed schedules could not be struck

down upon the erroneous view advanced by the protestants.” 319

U.S. at 686. Mr. Justice Black dissented, stating that the rate

structure unlawfully discriminated against barge traffic.

As noted above, the Commission, in the Inland Waterways

proceedings, stated that while protestants’ allegations could not

be sustained, “in a proper proceeding we might prescribe propor-

tional rates on the ex-barge traffic lower than local rates or joint

barge-rail rates lower than the combination ” 319 U.S. at 681.

Proceedings to that end ensued and formed the basis for the

Supreme Court’s decision in JCC v. Mechling, supra. The Com-

mission concluded that the proposed rate structure which con-

tained an 8% cent higher rate for ex-barge grain than for ex-rail

or ex-lake grain was unlawful. It further concluded, however, that

reshipping rates from Chicago for ex-barge grain would be rea-

sonable and lawful even though they were 3 cents per hundred-

weight higher than the comparable rates for ex-rail and ex-lake

grain. Various barge lines then instituted suit, contending that the

order was void in that it approved higher rates for ex-barge grain

without any showing that cost of transportation to the railroads

was higher for such grain than for ex-rail or ex-lake grain. The

district court sustained the petitioners’ allegations and enjoined

the Commission’s order to the extent that it permitted the 3 cent

differential. On appeal, the Supreme Court affirmed, relying in

a-8

part on 49 U.S.C. §2. Mr. Justice Black, writing for the majority,

stated:

The foregoing provisions flatly forbid the Commission to

approve barge rates or barge-rail rates which do not preserve

intact the inherent advantages of cheaper water transporta-

tion, but discriminate against water carriers and the goods

they transport. Concretely, the provisions mean in this case

that Chicago-to-the-east railroads cannot lawfully charge

more for carrying ex-barge than for carrying ex-lake or ex-

rail grains to and from the same localities, unless the eastern

haul of the ex-barge grain costs the eastern railroads more to

haul than does ex-rail or ex-lake grain... .

The basic error of the Commission here is that it seemed

to act on the assumption that the congressional prohibitions

of railroad rate discriminations against water carriers were

not applicable to such discriminations if accomplished by

through rates. But this assumption would permit the destruc-

tion or curtailment of the advantages to shippers of cheap

barge transportation whenever the transported goods were

carried beyond the end of the barge line. This case proves

that. For while Chicago is a great grain center, it cannot con-

sume all barge-transported grain. That grain, like other

grain coming to Chicago for marketing or processing, is re-

shipped to distant destinations.

330 US. at 577. Justices Frankfurter and Jackson dissented.

The third case relied on by one or the other of the parties is

James McWilliams Blue Line, Inc. v. United States, supra. That

case concerned railroad rates for the transportation of coal mined

in Virginia, West Virginia and Kentucky, to Hampton Roads

ports, then to New England ports, and finally to interior ports.

Shippers moving coal by rail to Hampton Roads, then by ocean

barge to the New England ports, and then by barge to its ultimate

destination (rail-ocean-barge) were charged 45 cents per ton

more for the initial rail transportation than those who used rail

transportation for the third and final leg of the movement (rail-

ocean-rail). All parties conceded that the railroads’ cost of trans-

a-9

porting the coal to Hampton Roads in the first instance was the

same in both cases. On complaint, the Commission found no un-

lawful discrimination. In subsequent court proceedings, however,

the district court held that the disparate rate structure was dis-

criminatory in violation of 49 U.S.C. §2, stating that the case was

indistinguishable from JCC v. Mechling, supra. See James

McWilliams Blue Line, Inc. v. United States, supra, 100 F. Supp.

at 70. The Supreme Court affirmed per curiam. 342 U.S. 951

(1952).

Based on our reading of the statute and of the cases urged by

each side as controlling, we agree with the Commission that the

rates here under attack are discriminatory as a matter of law

under 49 U.S.C. §2. We reject petitioners’ characterization of

Mechling and Blue Line as being limited to barges or comparisons

between through rates. Rather, we read those cases to hold that

different rates may not be charged similarly situated shippers for

the same service, based on the mode of transportation used in a

prior or subsequent movement, where the cost of providing the

service is the same. In view of the conceded similarity in costs and

circumstances in this case, Mechling and Blue Line compel a

finding of discrimination under section 2. Petitioners’ argument

that the truck-rail transportation of grain is a local movement

whereas the rail-barge, lake-rail movement is a through move-

ment is beside the point. Cf. ICC v. Mechling, supra, 330 U.S.

at 577.

We do not view /Jnland Waterways as being inconsistent with

Mechling and Blue Line. In that case the petitioners focused more

on the origin of the grain as the basis of the discrimination than on

the mode of transportation into Chicago. Both the Commission

and the Supreme Court stated that their holdings did not connote

approval of the rates, but only that petitioners’ assertions could

not be sustained. In any event, to the extent that Inland Water-

ways is inconsistent with Mechling and Blue Line, we are bound

a-10

» SE RO ete ee OR Ee

by the Supreme Court’s latest pronouncements as reflected in the

latter.’

The petition to review and set aside the orders of the Interstate

Commerce Commission is denied.

A true copy.

Attest:

Cuerk, U. S. Court OF APPEALS, EIGHTH CIRCUIT.

*Petitioners additionally contend that the Commission erred in

failing to consider the disruptive consequences of its decision on

the national grain rate structure. In view of our holding that the

Commission’s decision was mandated by Mechling and Blue Line,

we find no merit to this contention.

a-11 a

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

No. 76-1198

September Term, 1976

THE ATCHISON, TOPEKA AND SANTA FE

RAILWAY COMPANY, THE BALTIMORE AND OHIO

RAILROAD COMPANY, ROBERT W. BLANCHETTE,

RICHARD C. BOND AND JOHN H. MCARTHUR;

BURLINGTON NORTHERN INC., THE CHESAPEAKE

& Oun1o RAILway COMPANY, CHICAGO &

EASTERN ILLINOIS RAILROAD COMPANY,

CHICAGO, MILWAUKEE, ST. PAUL AND PACIFIC

RAILROAD COMPANY, CHICAGO AND NORTH

WESTERN TRANSPORTATION COMPANY,

CHICAGO SOUTH SHORE AND SOUTH BEND

RAILROAD COMPANY, DENVER RIO GRANDE

WESTERN RAILROAD COMPANY, WILLIAM

GIBBONS, TRUSTEE OF CHICAGO, ROCK ISLAND

AND PACIFIC RAILROAD COMPANY, DEBTOR,

GRAND TRUNK WESTERN RAILROAD CO., GREEN }

Bay & WESTERN RAILROAD Co., THE KANSAS

City SOUTHERN RAILWAY COMPANY,

LOUISVILLE AND NASHVILLE RAILROAD,

MISSOURI-KANSAS- TEXAS RAILROAD Co.,

Missouri PaciFic RAILROAD COMPANY,

NORFOLK AND WESTERN RAILWAY COMPANY,

THOMAS F. PATTON AND RALPH F. TYLER, JR.,

St. Louis-SAN FRANCISCO RAILWAY COMPANY,

St. Louis SOUTHWESTERN RAILWAY COMPANY,

SOUTHERN PACIFIC TRANSPORTATION CoO.,

Texas & Paciric RAILWAY COMPANY, UNION

PaciFiIC RAILROAD, THE WESTERN PACIFIC

RAILROAD COMPANY, CONSOLIDATED RAIL

CORPORATION,

Petitioners, |

a-12

On Petition

for Review of

Orders of the

Interstate

Commerce

Commission

ANHEUSER-BUSCH, INC., THE BOARD OF TRADE

OF KANSAS City, Missourl, INC., and AMERICAN

BAKERS ASSOCIATION,

Intervenors-Petitioners,

On Petition

vs. .

for Review of

| THE UNITED STATES OF AMERICA and + Orders of the

! INTERSTATE COMMERCE COMMISSION, Interstate

R — Commerce

pono, Commission

BOARD OF TRADE OF THE CITY OF CHICAGO,

Intervenor-Respondent. |

This cause came on to be heard on petition for review of orders

of the Interstate Commerce Commission and briefs filed by the

respective parties and were argued by counsel.

On Consideration Whereof, it is now here ordered and ad-

judged by this Court that the petition to review and set aside the

orders of the Interstate Commerce Commission is denied.

February 24, 1977

| A true copy.

Attest:

ROBERT C. TUCKER

Clerk, U. S. Court of Appeals, 8th Circuit.

April 7, 1977

a-13

a | a Ce ) a a ee a a

is 6

, tt pene 6 sy ced oe ik wo

}

APPENDIX B

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

No. 76-1198

THE ATCHISON, TOPEKA AND SANTA FE

RAILWAY COMPANY, et al.,

Petitioners,

VS.

THE UNITED STATES OF AMERICA and

INTERSTATE COMMERCE COMMISSION,

Respondents.

September Term, 1975

Petition for

Review of

Orders of the

Interstate

Commerce

Commission.

Petitions of petitioners and intervenor-petitioner for rehearing

filed in this cause having been considered, it is now here ordered

by this Court that the petitions for rehearing be, and they are here-

by, denied.

March 31, 1977

b-1

APPENDIX C

DECISION AND ORDER

At a Session of the INTERSTATE COMMERCE

COMMISSION, Division 2,

held at its office in Washington, D.C., on the 14th

day of January, 1976.

No. 35825

BOARD OF TRADE OF THE CITY OF CHICAGO

THE AKRON, CANTON, & YOUNGSTOWN RAILROAD

COMPANY, ET AL.

Upon consideration of the complaint and the record in the

above-entitled proceeding, including the initial decision and

order of the Administrative Law Judge, the exceptions thereto

filed by complainant, defendants, and by the western railroads,

Peavey Company, and Archer Daniels Midland Company

(intervenors), and the replies to the exceptions filed by com-

plainant, jointly by defendants and the western railroads,

intervenors, and Archer Daniels Midland Company, intervenor;

and

It appearing, That the exceptions do not show any material

errors in the Administrative Law Judge’s statement and eval-

uation of the facts, his conclusions of law or findings, nor do

they raise any material matters of fact or law not adequately

considered and properly disposed of by the Administrative Law

Judge in his initial decision, and are not of such nature as to

require the issuance of a report by Division 2 discussing the

evidence and arguments advanced in the light of such ex-

ceptions;

Wherefore, and good cause appearing therefor:

We find, That the evidence considered in the light of the

exceptions and the replies thereto does not warrant a result

different from that reached by the Administrative Law Judge,

and that the statement of facts, conclusions and the findings of

the Administrative Law Judge, being proper and correct in all

material respects, should be, and they are hereby, affirmed and

adopted as our own.

It is ordered, That the Proceeding be, and it is hereby,

discontinued.“

By the Commission, Division 2.

Rosert L. OswaLp

Secretary

(SEAL)

Ae et ae ee tte a Leann de Set acai

APPENDIX D

Interstate Commerce Commission

INITIAL DECISION

No. 35825

BOARD OF TRADE OF THE CITY OF CHICAGO

THE AKRON, CANTON, & YOUNGSTOWN

RAILROAD COMPANY, ET AL.

Maintenance of the assailed proportional or reshipping

rates from Chicago, Ill., to points in the eastern United States,

as set forth in the defendant railroads’ tariffs, on wheat and

wheat products, in carloads, where the prior movement of the

commodities to Chicago is by railroad, lake vessel, or barge

without maintaining like rates and charges, at the same levels,

from and to the same points on the same commodities where

the prior movement to Chicago is by motor for-hire carrier.

found unjustly discriminatory in contravention of the provisions

of section 2 of the Interstate Commerce Act; and assailed rates

and charges otherwise found not shown to be unlawful. De-

fendants ordered to cease and desist from the referred to

violation and to publish appropriate tariffs removing such

violation. Complaint in all other respects dismissed.

Harold E. Spencer and Frank E. Polom for complainant.

John J. Paylor and Richard A. Mehley for eastern railroad

defendants.

By Alvin H. Schutrumpf, Administrative Law Judge:

By complaint filed April 9, 1973, the Board of Trade of the

City of Chicago alleges that the present rate structure on wheat

and wheat products (as listed and defined in TL-CTR Tanff

600-1, 1.C.C. C-168) covering (1) flat and proportional rates

published in TL-CTR Eastern Grain Tariff C/TN 245-I, L.C.C.

C-375, from Chicago to eastern basing points, viz: Albany,

N. Y., Baltimore, Md., Belington, W. Va., Boston, Mass.,

Cumberland, Md., Hagerstown, Md., New York, N. Y., New-

port News, Va., Norfolk, Va., Philadelphia, Pa., Rochester,

N. Y., Rockland, Maine, Strasburg, Va., Syracuse, N. Y., Utica,

N. Y., and points taking the same rates; (2) proportional rates

from Chicago, Ill., as published in CTR Tariff 535-C I, LCC.

4495 to destinations named therein and points taking the same

rates; and (3) flat rates, as published in the individual lines’

tariffs of defendants to destinations covered by the last named

tariff; are unlawful as hereinafter described. The railroads

listed in Appendix A hereto were named as defendants.

Complainant alleges (1) that the maintenance and collec-

tion of such rates and charges were and still are unjust and

unreasonable in violation of section | of the Act; unjustly

discriminatory to wheat arriving at Chicago by rail from points

beyond for further movement to the east in violation of section

2 of the Act; and unduly prejudicial to Chicago, to complainant

and to its members, and to wheat and wheat products in

violation of section 3(1) of the Act; and (2) that maintenance

by defendants of proportional domestic rates as referred to

above are unjust and unreasonable in violation of section | of

the Interstate Commerce Act, unjustly discriminatory to motor-

carrier-arrived wheat' at Chicago and the shippers of such

wheat and wheat products made therefrom, in violation of

section 2 of said Act, and unduly prejudicial to complainant

and its members, to Chicago, and to motor-carrier-arrived

wheat at Chicago in violation of section 3(1) of said Act.

Complainant seeks flat rates on wheat and wheat products

from Chicago to eastern basing points uniformly 6.5 cents

higher than the proportional rates, with the rates on wheat

products being made one-half cent higher than those on wheat,

‘Sometimes called ex-truck wheat, ex-truck wheat products, or

ex-truck traffic.

d-2

i cet ote mate & oY

and revision of the applicable tariffs so as to permit the

application of the proportionals on motor-carrier-arrived wheat

and wheat products with the additional provision that the

proportional rates applicable are those in effect on the dates

said shipments leave Chicago.

Answers to the complainant were filed by certain defend-

ants.

The proceeding was referred to the Judge for hearing and

the issuance of an appropriate order thereon. Hearing was held

at Chicago, Ill., on January 7, 8, and 9, 1974. Evidence was

submitted on behalf of complainant and on behalf of certain

eastern railroad defendants. Briefs were filed.

The Board of Trade of the City of Chicago (hereinafter

called the Board) is a corporation created by an Act of the

Illinois legislature, with its principal business in Chicago, Ill. Its

1,402 members represent all segments of the grain and grain

products industries and include terminals, storage operators,

grain merchandisers, cash grain merchants, processors, millers,

exporters, and producers who operate and maintain facilities

within the switching limits of Chicago and who ship and receive

grain and grain products in interstate and foreign commerce.

The Board itself ships no wheat, wheat products, or like

commodities.

On March 13, 1972, complainant submitted to the Eastern

Railroads a proposal (a) for an adjustment in the spread

between the fiat and proportional rates on grain and grain

products from Chicago to eastern trunkline territory and (b)

for tariff amendment to permit the application of the proportio-

nal or reshipping rates from Chicago on grain and grain

products shipments reaching Chicago via motor carriers.

Ultimately these requests wer’ “nied and the complainant

filed the instant complaint, the relief sought being limited to

wheat and wheat products rates.

d-3

The grain rate structure from Central Freight Association

territory, including Illinois, to the east was established many

years ago and was originally based on what is commonly-

known as the McGraham Formula. Basically, the key rates are

the Chicago-New York proportional and flat rates. Proportio-

nal rates are made from Chicago to other eastern basing points

predicated on a percentage and/or differential over or under

the Chicago-New York rate. Historically, rates from other

origins in official territory were made as a percentage of the

Chicago flat rates and the origin area was assigned group

numbers which basically reflected the percentage of the Chi-

cago rates. These rates were published as one-factor rates and

from Illinois origins the one-factor rates generally applied to

their routes through Chicago.

Paragraph (a) of Item 520 Series of TPO Maurer’s Tariff

C/TN 245-1, L.C.C. C-375 specifies, as follows:

Rates apply as reshipping or proportional rates appli-

cable on traffic reaching the re-shipping point via a rail or

water transportation line that can furnish to the outbound

carrier freight bill or like documentary evidence as to the

origin of the traffic and rate paid to the re-shipping point.

Rates also apply on through bill shipments not stopped in

transit at re-shipping points subject to this application.

This permits the use of the proportional rates from Chicago on

traffic reaching Chicago via a rail or water transportation line.

Rates also apply on through bill shipments not stopping at

Chicago.

One of the governing factors in the utilization of the

proportional rates from Chicago ts that a combination of rail

rate factors to and from Chicago may not be less than the flat or

local rate from Chicago to the same destination. This has been

referred to as the “pad” requirement, or minimum inbound

pay-in requirement. This provision is set out in subparagraph

(b) of Item 520, as follows:

d-4

~~.

bi. ol

~ — oan hee me eA

Provided that in no case shall the combination

through rate to and from the re-shipping point via rail be

less than the rate from the re-shipping point applicable on

a shipment originating thereat to final destination, the

difference necessary to protect such rate from the re-

shipping point to be added to the re-shipping rate there-

from.

The rules established by the Board of Trade concerning futures

contracts require that all grain delivered under these contracts

must protect the rail proportional rates from Chicago to points

in eastern territory.

While the rail carriers parties to the proportional rate from

Chicago require a pad on rail shipments to Chicago, they do not

maintain a pad requirement on inbound shipments arriving via

water. Thus, water-arrived grain at Chicago has the same

status as rail-grain insofar as the application of the proportional

rates are concerned, but inbound water-arrived grain has the

advantage over rail inbound grain in that there is no pad

requirement.

Appendix B hereto sets forth the flat and proportional rates

at various Ex Parte increased levels, together with the corre-

sponding pads, on wheat and wheat products from Chicago to

the basing point of New York City for the period March 1938

to date. Complainant points out that on March 10, 1960, the

flat rate from Chicago to New York was reduced from 73.5

cents to 67 cents (column 2) resulting in a pad of 12 cents

(column 4). Similarly, the flat rate on wheat products reflected

the historic one-half cent higher rate of 67.5 cents (column 5).

This adjustment is said to have been the outgrowth of Docket

No. 32790, Fourth Section Application No. 35140 and related

proceeding and was published in supplement 150 and 151,

CTRTB 245-I, 1.C.C. 4403.

Appendix C hereto shows the flat and proportional rates

and corresponding pads on wheat from Chicago, Ill., to eastern

d-5

trunkline basing points from March 10, 1960, to August 19,

1973. While the pads to all basing points were uniform at the

Ex Parte 212, 223, and 256 levels (columns 10, 9, and 8,

respectively ), this uniformity was not maintained subsequent to

the Ex Parte 256 increase, although apparently the carriers had

sought to make appropriate adjustments, but received opposi-

tion thereto from the Board and others.

Appendix D shows similar statistics for the same period

with respect to wheat products from Chicago to eastern trunk-

line basing points.

The flat or local rail rates from Chicago are not used to

ship wheat and wheat flour traffic from Chicago to the east

because they are too high in relation to the proportional rates.

They do, however, establish the pad which shippers must

conform to on any traffic moving beyond Chicago on the

proportional rates. For example, to utilize a proportional rate

of 81.5 cents cwt. (X-295-A level, 8-19-73) on wheat from

Chicago to New York, inbound the wheat rail billing must have

a paid-in rate of at least 16.5 cents cwt. or the deficiency must

be added to the proportional rate, which accrues to the eastern

carrier. In the case of wheat flour moving from Chicago on the

proportional rate of 81.5 cents cwt., a rail wheat bill must have

a paid-in rate of 19 cents cwt. or the deficiency made up.

Complainant’s representative at the hearing was unaware of

any instances where deficiencies had to be made up, stating that

the shippers make sure that no such situation arises.

Appendix E is a statement showing the flat and reshipping

rates and pads from Chicago to eastern trunkline destinations

on barley, corn, grain sorghums, and oats, published by the

Eastern Railroads for application from Chicago. The pad

varies from 4.5 to 7.5 cents cwt. Complainant states that this

was the first major departure from the long standing eastern

domestic grain rate structure. Wheat was not inciuded in the

list of whole grains on which the rates apply, nor was wheat

d-6

a ee eee |

flour included in the list of grain products. Wheat bran and

shorts, by-products of the wheat milling process, are included in

the list of animal and poultry feed ingredients on which these

rates apply. The re-shipping rates (application thereof pub-

lished in Item 655 of TPO Maurer’s Tariff E-772-G I.C.C. C-

945) from Chicago are applicable on traffic which reaches

Chicago via rail or water. There is no pad requirement on

water-arrived grain. As indicated, the pad on rail-arrived grain

varies from 4.5 to 7.5 cents, below the present pads applicable

at Chicago on wheat and wheat flour. Complainant has not

shown the circumstances surrounding the publication of these

rates. These rates, however, are limited with respect to routing

and diversion and reconsignment privileges, and are subject to

reduced free time, restricted transit privileges, limited liability

and higher inspection charges, which limitations generally are

not applicable to the rates on wheat and wheat products as set

forth in the 245-I tariff hereinbefore referred to.

Appendix F hereto sets out the level of the flat rates and

the re-shipping or proportional rates sought by complainant on

wheat and wheat products from Chicago to the eastern basing

points. The applicable Chicago-to-New York proportional rate

of 81.5 cents cwt. ( X-295-A level) on wheat is used as the key

rate with the rates to other basing points made as a differential

over or under, or a percentage of the Chicago-New York rate.

The flat or local rates are made by adding 6.5 cents to the

corresponding proportional rates. To restore the historic rate

relationships complainant has made the rates on wheat prod-

ucts one-half cent higher than those on wheat (columns 5 and

6). However, to accomplish the publication of the flat rates as

suggested by complainant, carriers would require relief from

Section 4 of the Interstate Commerce Act. Complainant

contends that this will present no problem to the carriers since

similar relief from Section 4 was obtained by the Penn Central

Railroad in connection with the application of one-factor rates

via Kankakee, Ill. The record establishes, however, that the

d-7

Kankakee rates and the Section 4 relief granted resulted from

water competition and the desire of the carriers to recapture rail

traffic lost to that water carrier, circumstances which were not

shown to be present in the instant case. In the alternative,

complainant states that defendants could protect the Fourth

Section by maintaining the Chicago rates to eastern points,

probably up to the Ohio-Indiana State line. No evidence with

respect thereto was submitted.

Water-arrived shipments of wheat and wheat products at

Chicago enjoy identical status with rail-arrived shipments in the

application of the re-shipping or proportional rates published

from Chicago in TPO Maurer’s Freight Tariffs C/TN 245-I

1.C.C. C-375 and CTR 535, I.C.C. 4499, except as hereinbefore

indicated, water-arrived traffic does not require a pad or

minimum pay-in as in the case of inbound rail shipments.

Complainant’s second request for relief seeks to permit the

application of the proportionals on motor carrier-arrived wheat

and wheat products with the provision that the proportional

rates applicable be those in effect on the dates such shipments

leave Chicago. This provision is identical with the applicable

inbound ex-lake traffic and permits the rail carriers to imple-

ment any increase in freight rates the day the increase becomes

effective, rather than revert to the date at point of origin of

inbound rail and barge traffic.

Complainant refers to an example where a proportional

rate applies on motor carrier-arrived grain published in Item

3385-F Supplement 77, TPO Watson’s NPCT Tariff 10-P L.C.C.

1158. These rates apply on barley or wheat from specified

Washington and Idaho points to specified Oregon and

Washington points, but do not allow transit inspections, diver-

sion, Or reconsignment, except that shipments may be recorded

at destination for transit. These rates thus are not comparable

to the assailed rates and are no support for the relief sought

herein.

Appendix G hereto is a statement showing wheat receipts

in bushels at Chicago for the years 1963 through 1972 via rail,

motor carrier, and water carrier, and the percent of the total of

each mode. However, the figures shown for the yerrs 1971 and

1972 do not include certain receipts by Dixie-Portland Flour

Mills, Inc. Using figures, in pounds, as submitted by this

shipper’s representative and as hereinafter set forth in Appen-

dix H, and converting pounds to bushels at the rate of 60

pounds per bushel, the rail receipts as shown in Appendix G for

the years 1971 and 1972 were, respectively, 7,469,000 and

7,362,000 and the truck receipts for 1971 and 1972 were,

respectively, 15,995,000 and 15,673,000. For the years 1971

and 1972, columns 2, 4, 6 and 8 would have to be revised

accordingly.

At the hearing held by the rail carriers certain parties

appeared and opposed the proposed tariff changes suggested by

complainant unless they were granted the same treatment.

Thus, the present flat rate from Chicago exceeds the flat

rate from Indianapolis to New York, whereas the proposed 88

cent flat rate from Chicago would be less than the present 90.5

cent rate from Indianapolis. Other flat rates from points

located east of Chicago to the Indiana-Ohio State line are

higher than 88 cents.

The present proportional rate from Chicago to New York

is 81.5 cents and complainant would retain that rate. This

compares, however, with the present flat rates from the central

part of Ohio, including Toledo, wherein the flat rate is also 81.5

cents. As to official territory, complainant's representative knew

of no point where the proportional rail rate is available at the

origin point on motor carrier-arrived traffic.

Generally the drawing area of the Chicago market for

wheat is northern Illinois, northern Indiana, and western In-

diana on the Milwaukee Railroad to Terre Haute, as well as the

former Chicago and Eastern Illinois Railroad.

d-9

Complainant states that if it is successful here that there

will be more traffic available to the Eastern Railroads. It is

noted, however, that on March 10, 1960, the flat rate was

reduced from 73.5 cents to 67 cents and on October 4, 1960, it

was increased to 68 cents and remained at that figure for almost

seven years, until August 19, 1967, when it was increased {170

cents. However, as shown in Appendix G hereto, during the

period 1963 through 1970 rail receipts showed a constant

decline, except 1966 exceeded 1965 and 1967 exceeded 1966.

In no year after 1963 did the rail receipts equal those in 1963.

Dixie-Portland Flour Mills, Inc., is engaged in the business

of milling wheat into flour. Its flour mills are located at

Chicago and other points not here involved; and it has an

elevator in Chicago on the Calumet River which is capable of

receiving and shipping wheat by barges and lake vessels. The

flour mill at Chicago is landlocked and located on the Penn

Central Transportation Company’s line. Its milling capacity is

9,000 cwt. per day and the rated elevator storage capacity

approximates 980,000 bushels. The Calumet elevator, which

was acquired in March 1971, has a rated capacity of 4.8 million

bushels and it is used to supply the Chicago flour mill with

wheat and to store wheat for outside companies. To supply its

Chicago flour mill with wheat from the Calumet elevator,

Dixie-Portland must use either rail (85 percent) or motor truck

(15 percent) in cross-town service, at additional expense. The

Chicago mill’s annual production is about 384,000,000 pounds,

of which 288,000,000 pounds consist of flour and 96,000,000

pounds consist of mill feeds.

Inbound wheat to the Chicago mill arrives by railroad or

motor carner and to the Calumet elevator by rail, truck, and

water carrier. This wheat omginates at country origins in

Illinois and Indiana and at such major terminals as the Twin

Cities, Omaha-Council Bluffs, and Kansas City, as well as

country stations west thereof. Of its flour production over 90

percent is distributed in the Chicago area ( approximately 150

d-10

miles of Chicago) by a motor contract carrier; some flour

moves three times a week to its flour distributing plant in

Memphis; and the remainder moves throughout the terntory

east of the Illinois-Indiana State line. Insofar as the rate-break

points of New York, Boston, Philadelphia, Norfolk and

Cumberland are concerned, it ships only to New York and then

only for sporadic periods. In Ohio, it ships only to Toledo, five

truckloads of 45,000 pounds each, every week. In addition to

wheat, it ships mill feeds outbound to various eastern points

including points within 150 miles of Chicago to which a

substantial amount moves, Ohio points, and considerable

amounts to New England points ( which take the Boston rate)

for use by feed producers. The Toledo traffic moves by bulk

truck and that to New England points moves by rail on both

proportional rates and the non-transit mileage rates in the 772

tariff hereinbefore referred to.

Appendix H hereto sets forth inbound receipts of wheat at

the Chicago mill and the Calumet elevator and the outbound

shipments of wheat products consisting of flour and mill feeds.

These outbound shipments move to the various destinations to

which the shipper ships but the evidence does not show the

amounts to specific geographical locations, other than as shown

above with respect to those to which “substantial” or “consid-

erable” amounts moved.

Of the approximate 1,500,000 bushels of soft wheat moved

into Calumet storage yearly from Illinois and Indiana ongins, in

excess of 20 percent moves in by rail. Also about 250,000

bushels of hard wheat moves in by barge and about 750,000

bushels of spring wheat moves in (90 percent by rail and 2

percent by truck).

When the Chicago mill was acquired about ten years ago,

it was for all practical purposes a 100-percent rail inbound and

outbound operation. Because of numerous across-the-board

increases in the gathering rates to Chicago, increases in the

outbound rates on products, and the rail carriers’ inability to

provide sufficient equipment and service, shipper sought other

modes of transportation. When it took over the plant, it

installed truck dump and bulk facilities at its flour mill and

during the subsequent years the amount of truck traffic handled

has increased.

Dixie-Portland’s milling operation at Chicago is in com-

petition with a General Mills’ mill in Chicago and with storage

facilities located in the Chicago area. Of the eight elevators in

Chicago, five are located on water and they have about 80

percent of the total storage capacity. Dixie-Portland states that

with respect to inbound movements of wheat its landlocked

Chicago flour operation is at a distinct disadvantage with

elevators located on water and that its inbound wheat move-

ment is confined strictly to rail and motor carrier.

Elevators located on water can and do bring wheat in by

barge or lake vessel in addition to rail and motor carrier; and

the facilities iocated on water can cancel their truck billing

against movements from Chicago via barge or lake vessels and

utilize the inbound water or rail carrier billing for rail move-

ments to the east in connection with proportional rates. This

ability to switch the inbound billing according to the best

possible advantage on outbound shipments is an advantage

which a landlocked operation does not have, except in con-

nection with inbound receipts by rail.

In view of the above, Dixie-Portland states that it would be

desirable for all concerned to allow inbound motor carrier

billing to be used in connection with outbound rail proportional

rates; that the recognition of truck billing will simplify transit

application and supervision: and that it will assist the mill to sell

its products to rail-oriented customers in the east. It further

states that Eastern Railroads would not suffer any loss in

revenue if the flat rates are reduced to the extent requested by

complainant because to its knowledge there are no movements

d-12

of wheat or wheat flour from Chicago on flat or local rates. It

expects that the relief sought by complainant would result in

additional wheat and wheat products traffic from Chicago to

eastern destinations; but it presented no specific evidence as to

where that alleged additional traffic would come from or how it

would be handled by defendant rail carriers, considering that

the latter appear unable to furnish all of the freight cars that the

shipper desires at present. It believes that if the pad is reduced

as sought to 6.5 cents cwt. it could operate thereunder by

purchasing its truck wheat at harvest at 4 cents a bushel

cheaper. However, during the last several years truck wheat

and rail wheat have been selling at the same price and the

record is not convincing that as of present if both truck wheat

and rail wheat moving into Chicago could move out on rail

proportional rates that truck wheat could be purchased at a

lower price than rail wheat at country origins.

Continental Grain Company, of Chicago, IIl., operates two

storage elevators at Chicago with a combined storage capacity ©

in excess of 16,000,000 bushels. It engages in the buying and

selling of grain, including wheat, but no wheat products. Its

principal drawing market is from points in northern Indiana

and northern Illinois within 150 miles of Chicago and most of

such wheat is trucked into Chicago. During the year September

1, 1972 to August 31, 1973, Continental shipped 13,840,000

bushels of delivery grain from their two elevators in Chicago.

In addition to this delivery function the company bought-and

sold many additional millions of bushels of grain that was put

through the Chicago elevators. It does not show, however, the

amount of this wheat which is included in the referred to

figures.

Its representative at the hearing is a grain merchandiser for

the company, a member of the Chicago Board of Trade

Transportation and Grain Committees and a former member of

the Board of Directors of the Board of Trade. He submitted

considerable evidence with respect to the operations of the

d-13

futures and cash markets in the grain marketing system. He

supports, on behalf of his company, the proposal to reduce the

pad, as hereinbefore described, and to allow the proportional

rates from Chicago to eastern points to be applicable to truck-

originated traffic. He pointed out, as hereinbefore described,

the advantages of having inbound wheat arriving at Chicago by

rail with rail billing and the advantages of switch billing for the

movement of outbound shipments of rail-arrived wheat and

motor carrier-arrived wheat. He states that the effect of rate

increases over the past years have made rail movement non-

competitive against truck competition, especially on wheat. He

admits, however, that much of the wheat moves by truck at the

present, because of the lack of sufficient rail cars to perform

such transportation. He expresses the view that the proposals

of complainant will assist Continental and other companies in

the Chicago area in obtaining wheat t6 move through the

Chicago market to eastern points.

Generally, Continental’s elevators are filled to capacity.

Although it is stated that the proposal would result in additional

wheat traffic for the Eastern Railroads no specific figures were

submitted and otherwise such opinion is not supported by

specific evidence. This traffic now is moving from other points,

including such points as Toledo from which it is being trans-

ported by the Eastern Railroads and any diversion of wheat

traffic to be moved through the Chicago market would be that

now moving from other markets, by Eastern Railroads, and

possibly other railroads.

It is pointed out that the Commodities Exchange Authority

of the United States Department of Agriculture ( which regu-

lates and supervises the futures market) was instrumental in

having the Chicago Board of Trade establish multiple delivery

points on the wheat contract and starting with the July 19, 1973,

contract, Toledo became a delivery point at 2 cents a bushel

discount to the Chicago futures price. This was based on the

difference in ocean or lake freight from Chicago to Toledo for

d-14

outbound water movements. No evidence was submitted,

however, showing that this results in any unlawful dis-

crimination or undue preference and prejudice within the

provisions of the Interstate Commerce Act.

A cash grain merchant located at Chicago supports the

proposals of the complainant, particularly the proposed appli-

cation of the rail proportional rates to truck-arrived shipments.

This witness solicits (a) consignments of grain from country

origins and (b) offers of “to arrived” grain which he purchases

and sells. In making sales of wheat to customers located east of

the Illinois-Indiana State line he looks to the elevators in

Chicago for stocks. Inbound billing is important to him in the

movement of the wheat to the east because his customers are

interested in rail transit billing, which enables them to utilize

the proportional rate from Chicago to various eastern destina-

tions. Thus, the flour mills located in the east which are

customers of his depend on freight rates which permit transit

arrangements. This allows the flour miller an opportunity to

transit for subsequent movement of his products to destinations

in the east. If the inbound movement of wheat into Chicago via

motor carriers is given the same status now permitted on similar

movements via rail or water in the application of the propor-

tional rates from Chicago, this witness is of the view that it will

put him in a position whereby he could increase his sales in the

east because there would be more flexibility on the part of the

elevator operators to offer him wheat without regard to whether

the grain arrived by rail, water, or motor carrier.

As stated by the prior witnesses, most of the wheat is

drawn from points in northern Illinois and northern Indiana

within 150 miles of Chicago and moves in by truck. Witness

states that the net returned to the farmer moving his wheat in

by truck is reduced by reason of the pad. However, he admits,

as have the other witnesses, that during the last several years

there has been little or no differential between wheat shipped

from the country ongins by truck and that shipped by rail.

d-15

Nevertheless, he states that by reason of the pad, buyers at

Toledo have an advantage over Chicago buyers, because of the

unavailability of proportional rates on truck-arrived traffic at

Chicago and the fact that the flat rate from Toledo is the same

as the proportional rate from Chicago to New York. He further

states that by reason thereof the mills and elevators east of

Chicago, particularly in Tolede and environs, are able to reach

into northeastern Indiana to points equi-distant between Chi-

cago and Toledo, bid for wheat in competition with the

Cnicago buyers, and move their flour and wheat out from

Toledo either by truck or on the 8!.5 cents flat rail rate. The

same situation is said to exist from numerous other points such

as Columbus, Cincinnati, and Fostoria, Ohio, Hillsdale, Mich.,

and Ligonier, Ind.

This witness i: yst entirely a rail operator, but does

purchase some truck wheat in northern Indiana. He has

experienced difficulty in purchasing rail-originated wheat and is

of the view that if rail proportionals out of Chicago were made

applicable to truck-arrived wheat, he would be more com-

petitive with respect to the drawing of wheat from points

equidistant from Toledo. Further, he is of the opinion that the

relief sought would not result in any loss of traffic to the Eastern

Railroads, and states that such relief would place the Eastern

Railroads in a position to attract more rail traffic. He acknowl-

edges, however, that the Eastern Railroads have had difficulty

in furnishing a sufficient number of cars for eastbound traffic;

that any alleged benefit from the proposal herein would be

contingent upon the Eastern Railroads having additional equip-

ment available; and that any such traffic as they might attract

would be traffic which now moves from other markets.

No evidence was submitted by this witness showing the

extent of his present operations and the extent to which there

would be an increase in wheat handled by him if the relief

sought is granted.

d-16

Defendants point out that the provision in Item 520 of the

245 tariff that the re-shipping or proportional rates apply only

on traffic reaching the re-shipping point via rail or water applies

not only to Chicago but to its competing points in Illinois and

neighboring States. Thus, Fast St. Louis and Kankakee, Ill., St.

Louis, Mo., and Milwaukee, Wis., among others, for example,

are similarly subject to this restriction on the application of the

proportional rate. The rates from Chicago are slightly lower in

comparison to those applicable from other Illinois points.

Various other origin points such as Milwaukee and Manitowoc,

Wis., take the same flat and proportional rates as Chicago.

Peoria and Decatur (from other than northwest origins), East

St. Louis, and Cairo, IIl., St. Louis, Mo., as well as other Illinois

points, have flat and proportional rates higher than Chicago.

Appendix I hereto sets forth rates from Chicago and com-

petitive points to New York. When traffic originates at a

western territory point, such as Kansas City, Mo.-Kans. the

combination rates to and from Chicago to eastern destinations

is equalized over the other gateways (except that Peoria is one-

half cent higher).

Appendix J shows the annual volume of wheat shipments

from Chicago by various modes of transportation during the

years 1962 through 1971; and according to 1971 Board of

Trade statistics, wheat was shipped during that year via lake

vessel, rail, and truck, in the following amounts:

Lake vessel — 2,954,000 bushels( domestic and export)

Rail 3.462.000 bushels

Truck 26,000 bushels

Appendix K shows the volume of wheat and flour handled

eastbound from Chicago by railroads during the six-year period

1958 through 1966 when the pad was 18.5 cents until March

1960 and thereafter from 12 to 13 cents, showing a decline in

traffic handled every year, except in 1965 with respect to wheat

and in 1960 and 1961 with respect to flour.

d-17

At the hearing Eastern Railroads contended that Chicago

is not prejudiced by the present rate structure, pointing to the

rates hereinafter set forth from other origins. They state that if

the relief sought is granted it could not be limited to wheat and

wheat products or to the movement of these commodities only

from Chicago and its environs, but would require a realignment

of the entire grain rate structure so as to include other grains

and grain products and require reductions from other origins,

the rates from which are related to the Chicago rates. Evidence

was presented showing that when complainant sought from the

railroads relief with respect to grain and grain products, similar

to that sought herein various shippers stated that any adjust-

ment made in the rates from Chicago to eastern destinations

would require a related adjustment from origins east of Chicago

and that in some instances shippers located west of Chicago

also objected to any change in the rate relationship. Thus, at

the hearing held by the railroads, General Foods appeared in

favor, provided that their plant at Kankakee received a similar

reduction with respect to corn and corn products. Also,

Pillsbury appeared in support of the similar proposal con-

cerning the application of the proportional rates to motor

carrier-arrived grain and grain products but suggested that St.

Louis and Minneapolis-St. Paul be accorded equal adjustment.

The only shipper which supported the proposal without quali-

fication concerning the addition or extension of the adjustment

to other origins was Continental Grain Company. The Eastern

Railroads also pointed out that it is doubtful that the reduction

sought on wheat and wheat products would result in any

additional traffic because a substantial amount of such traffic ts

now moving by eastern lines, as hereinbefore shown. The

26,000 bushels figure for truck wheat amounts to approximately

i3 carloads; and the 1,340,000 bushels of lake vessel traffic

which moves primarily to Buffalo would not, in the railroad’s

opinion, be divertable to their lines. Further, in 1971 a

substantial portion of the wheat shipments and all of the flour

shipments moved via rail. With respect to the facts concerning

d-18

Toledo and contentions with respect thereto, Eastern Railroads

point out that if the proportional rates are made applicable on

motor carrier-arrived wheat at Chicago the rails would then be

required to charge the proportional rate of 81.5 cents to New

York which is the same as the flat rate from Toledo, thus

transporting the traffic the extra 233 miles (from Chicago to

Toledo) for no additiomal charge. This, of course, deprives

Toledo of its natural advantage of being 233 miles closer to the

market.

Defendant The Baltimore & Ohio Railroad Company

(B&O) submitted an estimate of the approximate amount of

revenue reduction which it considers it would suffer if the Board

of Trade is successful in obtaining the relief sought herein.

B&O points out that complainant seeks a 10 cents reduction in

the Chicago-New York flat rate, from 98 cents to 88 cents or

approximately 10 percent. It concludes that, because of the

relationship between the flat rate from Chicago and flat rates

from St. Louis, Mo., points in Illinois, and points east of Illinois

to eastern destinations, a 10 percent reduction in the rates on all

wheat and wheat products traffic would ultimately be required

and that this would result in $97,478 reduction in B&O revenue

on this traffic. It further states thar if complainant is successful

in making the eastbound proportional rates applicable on truck-

arrived traffic, other official territory origins will demand similar

relief, resulting in additional revenue losses of $68,235, for a

loss of $165,713. Set forth as Appendix L hereto are figures

showing the pertinent traffic transported by The B&O during

1972 and the revenue therefrom, including a grand total

revenue of $974,780.

B&O is of the opinion that its estimate of losses set forth

above is conservative. In any event, it is of the view that even if

the same reduction in cents or a comparable percentage

reduction is not made with respect to all rates from origins east

of Chicago that some adjustments would have to be made in

d-19

order to clear the requirements of section 4 of the Interstate

Commerce Act. It bases this view on the opinion that the

Commission would not allow fourth section relief.

Penn Central Transportation Company (Penn Central)

submitted evidence similar to that submitted by the B&O.

Based on traffic statistics and revenues received by it in 1972 in

connection with the traffic involved in the instant proceeding, it

concludes that if a 10 percent reduction in the Chicago-New

York flat rate (from 98 cents to 88 cents) is granted Penn

Central could suffer a 10 percent reduction ($1,037,380) in

revenue, as shown in Appendix M hereto. It further states that

if complainant is successful in having the Chicago-New York

proportional rate made available on wheat trucked to Chicago,

this would, for all practical purposes, make the Chicago-New

York proportional rate the flat rate. And, all other official

territory origin points would insist that their rate relationship

with Chicago be maintained on all ex-truck traffic. It contends

that if this were done it would result in approximately a 17

percent reduction in the rates from and to the above referred to

points and Penn Central would experience an additional

$726,273 reduction in its revenues, for a total revenue loss of

$1,763,557. These revenue figures deal only with wheat and

certain wheat products. However, if the Eastern Railroads were

made to apply the sought reductions to other grains and grain

products (as initially sought by complainant in proposals to the

Eastern Railroads as hereinbefore referred to), the reduction in

Penn Central’s revenue would be much greater. Further, it

points out that Fourth Section relief would be required; and it

questions whether such relief would be granted by the Commis-

sion. It has made no estimate of the amount of revenue it

would expect to lose if rates at intermediate points would be

reduced to the level of the sought Chicago fiat rate.

Appendix N hereto sets forth the tonnage of wheat and

wheat products originated in 1972 at principal points in the

d-20

States named and the figures therein set forth are included in

Appendix M. These statistics were submitted at the request of

complainant.

Norfolk & Western Railway Company (N&W) submitted

evidence similar to that submitted by the other two railroad

defendants. Thus, as shown in Appendix O hereto, during

1972, N&W handled 6,261 cars of wheat and wheat products

from points in the listed States to the referred to destination

territory. These cars moved 227,434 tons producing $1,521,779

in revenue for N&W. The respective 10 percent loss and the

loss from the 17 percent reductions referred to in connection

with the prior railroads result in estimated losses of $255,490

and $178,844, for a total revenue loss of $434,334. Its

contentions were similar to those of the B&O and Penn Central.

As in the case of the other railroads, no calculations were made

as to what the projected effect would be on the N&W if the

Chicago flat rate were reduced to 88 cents and that was held at

a minimum at intermediate points.

DISCUSSION AND CONCLUSIONS

Complainant and its witnesses contend that the total relief

sought would make more traffic available to the Eastern

Railroads and thus be beneficial to them. Suffice it to say that

complainant’s evidence is too indefinite and conjectural to

support such a conclusion and, further, that defendants’ evi-

dence shows, at least, that reducing the flat rate would not

result in additional revenue. In any event, the question to be

resolved here is whether any of the complained of rates and

tariff provisions violate sections 1, 2, and 3 of the Interstate

Commerce Act, as alleged. The discussion hereafter will be

divided into two parts, count (1), that relating to the alleged

unlawfulness of the proportional and flat rates and the resulting

d-21

pads, and, count (2), that relating to the alleged unlawfulness

of the tariff provision which precludes on the outbound move-

ment from Chicago of motor carrier-arrived wheat the appli-

cation of the proportional rates now applicable to rail-arrived

and water-arrived wheat.

(1) In this count complainant alleges that the local and

joint flat and proportional domestic rates and charges on wheat

and wheat products from Chicago to various eastein basing

points and other destinations in the east are unjust and

unreasonable in violation of section | of the Act, unjustly

discriminatory to wheat arriving at Chicago by rail from points

beyond for further movement to the east in violation of section

2, and unduly prejudicial to Chicago, to complainant and its

members, and to wheat and wheat products in violation of

section 3(1) of the Act. It seeks to have the flat rates reduced

so that the pad would be uniformly 6.5 cents. See Appendix F

hereto.

Complainant points to the history of the flat and propor-

tional rates as shown in Appendix B hereto and states that the

evidence discloses no possible basis on which the present pads

can be justified. The burden of proof, however, is upon

complainant to show the unlawfulness of the rates resulting in

the pads. Mere allegations of unlawfulness are not sufficient.

As indicated, in this count complainant asks only that the

flat rate be reduced. It presented no cost evidence or other cost-

related evidence showing that the flat rates are excessive and

thus unreasonable. It refers to the mileage rates which are

published in the CTR 772 series tariffs, I.C.C. C-945, which

apply on barley, corn, grain sorghums, soybeans, and oats,

pointing out that the pads with respect to the rates on these

commodities range from 4.5 to 7.5 cents. See Appendix E.

These latter rates deal with commodities different from those

here in issue (being used principally for animal and poultry

feeds) and are, as hereinbefore set forth, subject to various

restrictions or limitations (to which the challenged rates are not

d-22

subject) which preclude their consideration in determining the

reasonableness of the assailed flat rates. The fact that the flat

rates are higher than the proportionals, in excess of 6.5 cents,

does not without further proof establish that they are unreason-

able. The progressive increases in flat rates and pads resulted

from Ex Parte increases found by the Commission to be lawful.

The record establishes that no traffic moves from Chicago

under the assailed flat rates, but the record does not establish

that the flat rates have inhibited the movement of the involved

traffic out of Chicago. Further, the record contains no con-

vincing evidence that the sought reductions would result in

movements thereunder. A statement by one of complainant’s

supporting witnesses that he probably could purchase truck-

originated wheat at country ongins at a sufficient discount to

warrant the use of the flat rates is no more than conjecture and

flies in the face of recent facts which show that due to the

demands for wheat and the shortage of freight cars to haul it,

truck-originated wheat has been selling at country ongins at or

near the prices of rail-originated wheat. The changes in the flat

rates and pads sought by complainant are not to correct a

transportation condition, but rather a market condition so as to

enable its members to more readily buy and sell wheat and

wheat products without being unduly inhibited by the Board of

Trade rule which requires the seller to protect the pad on wheat

and wheat products moving out of Chicago.

The Judge concludes that complainant has failed to show

that the assailed rates and the resulting pads are unreasonable

in violation of section | of the Act.

(b) Although under this count, complainant alleges viola-

tion of section 2, in its brief it sets forth no specific contentions

concerning the alleged discrimination of the flat rates per se and

resulting pads, relying instead on the justification therefor

under its contentions relating to count 2.

d-23

Motor carrier-arrived wheat is not enutled to the

proportional rates and, therefore, there is no pad which could

differ from that applicable to rail-arrived whea: and thus

resulting in discrimination to rail-arrived wheat. The flat rates

are equally applicable to all wheat moving to, through, and

from Chicago. Further, even if the proportionals are made

applicable to motor-arrived wheat there would be no dis-

crimination because they would be applicable to all common

carrier-arrived wheat. At present, the pad is required in

connection with rail-arrived wheat in order to avoid violations

of section 4 of the Interstate Commerce Act. No such problem

exists with respect to motor carrier-arrived wheat. Further, as

hereinbefore set forth, the rates provided in Tariff E-772 on

coarse grains, etc., used as feed ingredients, do not cover like

traffic as that here involved and, as indicated above, are subject

to differing restrictions and conditions so that they do not cover

“a like and contemporaneous service in the transportation of a

like kind of traffic under substanually similar circumstances and

conditions” as provided in section 2.

The Judge concludes that under this count complainant has

failed to establish that the assailed rates and the resulting pads

are discriminatory in violation of section 2 of the Act.

Whether the proportionals are discriminatory or unduly

preferential because they are not applicable to motor carrier-

arrived wheat will be discussed hereinafter under count 2.

discussed above, complainant in its brief does not under this

count submit arguments as to alleged section 3( 1) violations.

The evidence does not establish that the assailed rates prejudice

complainant ( which ships no traffic) and its members, Chicago.

or wheat and wheat products in violation of section 3(1), as

alleged. Insofar as rates on wheat and wheat products from

other shipping points are concerned, the evidence shows that

the flat and proportional rates from those origins are the same

d-24

as or higher than the rates from Chicago, and also, that the

pads applicable from those points on comparable rates are

equal to or higher than the Chicago pads. See Appendix I

hereto.

Toledo, also a competitor of Chicago, has available for

shipments into the east a flat rate equal to the Chicago

proportional, although Toledo is located 233 miles closer to

eastern markets than is Chicago. Further, the Tariff E-772 rates

afford no basis for a conclusion of preference and prejudice for

the reasons hereinbefore set forth.

The Judge concludes that coniplainant has failed to estab-

lish any violation of the provisions of section 3(1) of the Act.

2. In this count, complainant alleges that the proportional

rates on wheat and wheat products from Chicago to the east are

unjust and unreasonable in violation of section | of the Act;

unjustly discriminatory to motor-carrier-arrived wheat at Chi-

cago and the shippers of such wheat and wheat products made

therefrom, in violation of section 2; and unduly prejudicial to

complainant and its members, to Chicago, and to motor-carrier-

arrived wheat in Chicago in violation of section 3( 1).

The Chicago proportional rates are restricted against appli-

cation upon wheat which arrives at Chicago by motor carrier.

They are, however, applicable on wheat which arrives at

Chicago by rail or by water, and the products thereof. Wheat

does arrive at Chicago by motor carrier and the volume of such

motor-carrier-arrived wheat has been substantially increasing in

recent years both as a result of disparities between the rail and

the motor carrier rates and as a result of the inability of the rail

carriers to furnish equipment to move wheat to the market.

Up to 1939, the proportional or reshipping rates from

Chicago to the east applied equally on grain arriving at Chicago

ex-rail, ex-lake, or ex-barge. Because of the vast increase in

harge tonnage from competitive points subsequent to 1933, the

d-25

rail carriers proposed to restrict the proportional or reshipping

rates against ex-barge traffic in order to recapture some of the

traffic lost to the barges. The Commission originally held that

this could be done, but indicated that in a proper proceeding it

might prescribe proportional rates on the ex-barge traffic lower

than local rates or joint barge-rail rates lower than the com-

binations. Grain Proportionals, Ex-Barge to Official Territory,

248 LC.C. 307 (1941).

Subsequently, in a report on further hearing in Grain

Proportionals, Ex-Barge To Official Territory, 262 1.C.C. 7, the

Commission concluded, in part, that ex-barge grain rates east

from Chicago would be reasonable and lawful even though

they were 3 cents per hundred pounds higher than rates for ex-

rail and ex-lake grain. Thus, in effect, the Commission

permitted the railroads to charge higher reshipment rates for

ex-barge than for ex-lake and ex-rail grain.

The last cited decision was appealed to the Courts and

ultimately resulted in the decision of the Supreme Court of the

United States in 1.C.C. v. Mechling, 330 U.S. 567 (1947). In

that case, after referring to various provisions in part III of the

Act, as well as section 3(4), the Supreme Court continued ( pp.

576-577):

Finally § 2 of the pre-existing Act has long forbidden

the Commission to authorize railroads to charge one

person more than another for “a like and contempo-

raneous service in the transportation of a like kind of traffic

under substantially similar circumstances and conditions

...”’ [February 4, 1887] 24 Stat 379, 380, c 104, 49 USCA

§ 2, |OA FCA title 49, § 2.

The foregoing provisions flatly forbid the Commission

tO approve barge rates or barge-rail rates which do not

preserve intact the inherent advantages of cheaper water

transportation, but discriminate against water carriers and

the goods they transport. Concretely, the provisions mean

d-26

in this case that Chicago-to-the-east railroads cannot

lawfully charge more for carrying ex-barge than for

carrying ex-lake or ex-rail grains to and from the same

localities, unless the eastern haul of the ex-barge grain

costs the eastern railroads more to haul than does ex-rail

or ex-lake grain. (Emphasis added. )

The barge carriers involved in the Mechling case were

certificated carriers under part III of the Act, but the grain

traffic they handled was not necessarily subject to regulation

and much of it in fact was not handled on regulated rates.

Furthermore, as indicated, the eastern rail carriers had always

permitted lake-arrived grain to move out on the Chicago

proportional rates without penalty.

As a result of the decision in the Mechling case, the Eastern

Railroads amended their tariffs to provide that the Chicago

proportional rates would be applicable on grain which arrived

at Chicago ex-barge.

The matter of restricting rail proportional rates against

application on coal traffic having a subsequent movement by

barge wholly on unregulated rates came before the Commission

in James Mc Williams Blue Line v. Campbell’s Creek R. Co., 278

1.C.C. 312 (1950). Again the Commission held that such a

restriction was lawful. It stated at page 319:

Complainant Blue Line cites /nterstate Commerce

Commission v. Mechling, 330 U.S. 567, in which the Court

permanently enjoined our order authorizing a 3-cent in-

crease in certain ex-barge proportional rates on grain,

without corresponding increases in certain proportional

rates or specifics on ex-rail and ex-lake grain, the three sets

of rates having been theretofore on a panty. The circum-

stances in that case are fully set forth in the Court’s

decision and in our report in Grain Proportionals, Ex-

Barge to Official Territory, 262 1.C.C. 7. They differed in

many essential respects from those presented here. Most

d-27

of the barge transportation of the grain was subject to our

jurisdiction and it was impracticable to distinguish from a

rate-making standpoint between that which was subject to

our jurisdiction and that which was not. The lake

transportation of the grain, like the coal transportation by

water in the instant proceedings was not subject to our

jurisdiction. Increasing the ex-barge rates on grain with-

Out corresponding increases in the ex-lake rates on grain

would have resulted in more favorable treatment of the

unregulated lake transportation than of the regulated

barge transportation. (Emphasis added. )

Suit was then filed by James McWilliams Blue Line in the

United States District Court for the Southern District of New

York to set aside and enjoin the Commission's order. The court

granted the relief sought. In its opinion in James Mc Williams

Blue Line v. United States, \00 F. Supp. 66 (1951), it said, at

page 70:

... we hold that the rates complained of are unlawful

because in violation of Section 2 of the Interstate Com-

merce Act, 49 US.C.A. §2. We find it unnecessary,

therefore, to determine the legality of these rates under

Sections 3(1) and 3(4) of the Act.

We are unable to distinguish the instant case from

1.C.C. v. Mechling, 1946, 330 U.S. 567, 67 S.Ct. 894, 91

L.Ed. 1102. There the order of the Commission permitted

the railroads to charge higher reshipment rates (3 cents per

100 Ibs.) east from Chicago for grain brought to Chicago

by barge than for ex-lake or ex-rail grain. The enforce-

ment of the order was enjoined to the extent that it

permitted this extra charge.

... It has been settled with respect to the provisions of

Section 2 of the Act prohibiting different charges by a

common carrier for “a like and contemporaneous service in

d-28

the transportation of a like kind of traffic under substan-

tially similar circumstances and conditions” that “***the

clause did not allow carriers by railroad to make a

difference in rates because of differences in circumstances

arising either before the service of the carrier began or

after it was terminated.”

Nor are we impressed by the attempt of the Commission

to distinguish this cuse from the Mechling case because the

Commission cannot regulate “Blue Line’s” barge rates.

That was true, at least as to part of the ex-barge grain in

the Mechling case; however, as we read the Mechling case,

the decision was not based upon the existence of jurisdic-

tion in the Commission to regulate the barge rates on the

grain traffic and was reached quite independently of such

jurisdiction. (Emphasis added. )

In granting the relief sought, the court directed the Com-

mission “to make and enter an appropriate order ending the

practice complained of and enjoining the Commission from

further continuing and enforcing the practices and rates now in

effect”. The court’s judgment was affirmed per curiam by the

Supreme Court. /nterstate Commerce Commission v. James

McWilliams Blue Line, Inc., 342 U.S. 951 (1952). See also,

Chicago, Rock Island & Pacific R. Co. v. United States, 233 F.

Supp. 381, 386 (E.D. Mo., 1964).

The present situation cannot be distinguished from the

Blue Line and Mechling cases. A large amount of wheat arrives

at Chicago by motor carrier as well as by rail and water, but,

whereas inbound billing on the ex-rail, ex-lake, and ex-barge

wheat can be used to engage the Chicago proportional rates to

the east, this is not true with respect to ex-truck billing. All

wheat, whether ex-rail, ex-lake, ex-barge, or ex-truck goes into

the same elevators. When it does so, it loses its identity insofar

d-29

as its mode of transportation is concerned. With respect to all

wheat of the same type, there is no way to distinguish whether

it arrived at the elevator by rail, water, or truck.

The issue here is not a matter of the physical transportation

of the wheat and products but of the application of the inbound

billing. When wheat comes out of the elevator or when wheat

products are shipped from a mill, in most cases, neither the

shipper nor the railroad knows iow that particular wheat

arrived at the elevator, nor does it make any difference to them.

It makes no difference in the operation of the railroad whether

the wheat arrived by rail, water, or truck.

Furthermore, switching billing is common and is permitted

by the rail tariffs. In such a case, wheat which, because of its

type, can be identified as having moved to the mill or elevator

by truck, can be shipped out on the proportional rates and

inbound rail or water billing can quite properly be applied so as

to engage the proportional rates.

In any case, it makes no difference to the Eastern Railroads

how the wheat arrived at the elevator or mill. Their service is

exactly the same on the Chicago-to-the-east move whether the

wheat arrived at the mill or elevator by rail, water or truck and

thus the costs are the same.

Although no wheat or products thereof have moved on the

flat rates to eastern points and shippers have, by various means

moved their traffic out of Chicago, (including the shipment of

motor-carrier-arrived wheat under rail proportional rates by

switch-billing ), they have shown that the complained of restric-

tion has inhibited and damaged them in the conduct of their

businesses of buying and selling wheat and wheat products and

in the shipping thereof.

The Judge concludes that the Eastern Railroads’ restriction

against permitting the Chicago proportional rates to the east to

apply on motor-carrier-arrived wheat at Chicago is an unjust

d-30

discrimination against such wheat and the shippers thereof in

violation of section 2 of the Act, and that such restriction should

be removed from the tariffs of the Eastern Railroads. In view

of the above conclusion no further consideration will be given

to the alleged violations of sections | and 3{1) of the Act.

The decision herein is not a major Federal Action signifi-

cantly affecting the quality of the human environment within

the meaning of the National Environmental Policy Act of 1969.

FINDINGS AND ORDER

The Administrative Law Judge finds that the maintenance

of the assailed proportional or reshipping rates and charges

from Chicago, Ill., to points in the eastern United States, as set

forth in the defendant railroads’ tariffs, on wheat and wheat

products, in carloads, where the prior movement of the com-

modities to Chicago is by railroad, lake vessel, or barge,

without maintaining like rates and charges, at the same levels,

and from and to the same points on the same commodities

where the prior movement to Chicago is by for-hire motor

carrier, is unjustly discriminatory in contravention of the provi-

sions of section 2 of the Interstate Commerce Act; and that the

assailed rates and charges are not shown to be otherwise

unlawful.

The Judge further finds that this decision is not a major

Federal Action significantly affecting the quality of the human

environment within the meaning of the National Environmen-

tal Policy Act of 1969.

It is the ORDER of the Administrative Law Judge that the

defendant railroads be, and they are hereby, noufied and

required to cease and desist within 60 days of the date this

order becomes effective and thereafter to abstain from the

application of the rates and charges herein found unlawful; that

the defendants be, and they are hereby notified and required to

d-31

establish within 60 days of the date, this order becomes

effective, upon not less than 30-days’ notice to this Commission

and to the genera! public, by filing and posting in the manner

prescribed in the Interstate Commerce Act, and thereafter to

maintain and apply, rates and charges removing the unlawful

discrimination herein found to exist: and that this order shall

continue in force until the further order of the Commission.

It is further ordered, That the complaint in all other

respects be, and it is hereby, dismissed.

And it is further ordered, That in the absence of a stay or

postponement by the Commission, or the timely filing of

exceptions, the effective date of this order shall be 30 days from

the date of service thereof.

Dated at Washington, D.C. this 18th day of April, 1974.

By the Commission, (Alvin H. Schutrumpf), Adminis-

trative Law Judge.

Rosert L. Oswa.p,

Secretary.

(SEAL)

d-32

A-l

No. 35825

Appendix A

List of Defendants

Group I

Baltimore and Ohio Railroad Company, The.

Chesapeake and Ohio Railway Company, The,

Chesapeake District.

Chesapeake and Ohio Railway Company, The,

Pere Marquette District.

Chicago & Eastern Illinois Railroad Company.

Chicago, Milwaukee, St. Paul and Pacific Railroad Company.

Chicago South Shore and South Bend Railroad.

Erie Lackawanna Railway Company, Thomas F. Patton and

Ralph S. Tyler, Jr., Trustees.

Grand Trunk Western Railroad Company.

Louisville and Nashville Railroad Company.

Norfolk and Western Railway Company.

Penn Central Transportation Company, George P. Baker,

Richard C. Bond, and Jervis Langdon, Jr., Trustees.

Group II

Akron, Canton & Youngstown Railroad Company, The.

Ann Arbor Railroad Company, The.

Arcade and Attica Railroad Corporation.

Aroostock Valley Railroad Company.

Baltimore and Annapolis Railroad Company, The.

Baltimore and Eastern Railroad Company.

Baltimore and Ohio Chicago Terminal Railroad

Company, The.

Bangor and Aroostock Railroad Company.

Bath and Hammondsport Railroad Company.

d-33

A-2

Belfast and Moosehead Lake Railroad Company.

Bellefon’e Central Railroad Company.

Belt Railway Company of Chicago, The.

Bessemer and Lake Erie Railroad Company.

Boston and Maine Corporation, Robert W. Meserve, Trustee.

Boyne City Railroad Company.

Brooklyn Eastern District Terminal.

Burlington Northern Inc.

Cambria and Indiana Railroad Company.

Canadian National! Railways Lines Thunder Bay, ON.,

Armstrong, ON., and East thereof.

Carolina, Clinchfield and Ohio Railway; Carolina, Clinchfield

and Ohio Railway of South Carolina, Lessees: Seaboard

Coast Line Railroad Company; Louisville and Nashville

Railroad Company.

Carolina and Northwestern Railway Company.

Central Indiana Railway Company.

Central Railroad Company of New Jersey, The, Robert D.

Timpany, Trustee.

Central Vermont Railway, Inc.

Chesapeake Western Railway.

Chestnut Ridge Railway Company.

Chicago & Illinois Midland Railway Company.

Chicago and North Western Transportation Company.

Chicago River and Indiana Railroad Company, The.

Chicago, Rock Island and Pacific Railroad Company.

Cincinnati, New Orleans and Texas Pacific Railway

Company, The.

Claremont and Concord Railway Company, Inc.

Clarendon and Pittsford Railroad Company, The.

Cooperstown and Charlotte Valley Railway Corporation.

Coudersport and Port Allegany Railroad Company.

CP Rail (Canadian Pacific Limited) Lines Thunder Bay, ON.,

and East thereof.

Dansville and Mount Morris Railroad Company, The.

Delaware and Hudson Railway Company.

d-34

A-3

Detroit and Mackinac Railway Company.

Detroit, Toledo and Ironton Railroad Company.

Detroit and Toledo Shore Line Railroad Company, The.

East Jersey Railroad and Terminal Company.

East Washington Railway Company.

Elgin, Joliet and Eastern Railway Company.

Fonda, Johnstown and Gloversville Railroad Company.

Fore River Railroad Corporation.

Frankfort & Cincinnati Railroad Company.

Genesee and Wyoming Railroad Company.

Georgia Rail Road & Banking Company, operated as the

Georgia Railroad by

Lessees:

Louisville and Nashville Railroad Company

Seaboard Coast Line Railroad Company.

Grafton and Untcn Railroad Company.

Grand Trunk Railway System

Green Mountain Railroad Corporation

Greenwich & Johnsonville Railway Company.

Hoboken Shore Railroad.

Pittsburgh and Lake Erie Railroad Company, The.

Pittsburgh & Shawmut Railroad Company, The.

Port Huron and Detroit Railroad Company.

Quebec Central Railway Company.

Rahway Valley Railroad (Rahway Valley Company, Lessee).

Raritan River Rail Road Company.

Reading Company, Richardson Dilworth and Andrew L.

Lewis, Jr., Trustees.

Richmond, Fredericksburg and Potomac Railroad Company.

Rosslyn Connecting Railroad Company.

St. Johnsbury & Lamoille County Railroad.

St. Louis Southwestern Railway Company.

Seaboard Coast Line Railroad Company.

Seaport Navigation Company.

Skaneateles Short Line Railroad Corporation.

Soo Line Railroad Compary.

d-35

A-4

South Brooklyn Railway Company.

Southern Railway Company.

Springfield Terminal Railway Company ( Vermont).

Staten Island Railroad Corporation, The.

Stewartstown Railroad Company, The.

Terminal Railroad Association of St. Louis.

Toledo, Peoria & Western Railroad Company.

Toronto, Hamilton and Buffalo Railway Company, The.

Trenton-Princeton Traction Company. ( RDG)

Twin Branch Railroad Company.

Vermont Railway, Inc.

Virginia Central Railway.

Warwick Railway Company.

Wellsville, Addison & Galeton Railroad Corporation.

Western Maryland Railway Company.

West Virginia Northern Railroad Company.

Wharton and Northern Railroad Company.

Winchester and Western Railroad Company.

Winfield Railroad Company, The.

Yancey Railroad Company.

Youngstown & Southern Railway Company.

Illinois Central Gulf Railroad Company.

Illinois Northern Railway.

Illinois Terminal Railroad Company.

Indiana Harbor Belt Railroad Company.

Ironton Railroad Company, The (Lehigh Valley Railroad

Company and Reading Company, Lessees ).

Lackawanna & Wyoming Valley Railway Company.

Lake Erie, Franklin & Clarion Railroad Company.

Lehigh and Hudson River Railway Company, The, John

Trioano, Trustee.

Lehigh and New England Railway Company.

Lehigh Valley Railroad Company, John F. Nash and Robert C.

Haldeman, Trustees.

Livonia, Avon & Lakeville Railroad Corporation.

Long Island Rail Road Company, The.

d-36

Berens

A-5

Lorain & West Virginia Railway Company, The.

Louis’ ille and Nashville Railroad Company.

Louisville, New Albany & Corydon Railroad Company.

Lowville and Beaver River Railroad Company, The.

Maine Central Railroad Company.

Manufacturers Railway Company.

Maryland and Pennsylvania Railroad Company.

Middletown and New Jersey Railway Company, Inc.

Midway Railroad Company.

Missouri-Illinois Railroad Company.

Missouri-Pacific Railroad Company.

Montour Railroad Company.

Montpelier and Barre Railroad Company.

Morristown & Erie Railroad Company.

Moshassuck Valley Railroad Company.

Narragansett Pier Railroad Company, Inc., The.

New Jersey, Indiana & Illinois Railroad Company.

New York Dock Railway.

New York and Long Branch Railroad Company, The.

New York, Susquehanna and Western Railroad Company.

Norfolk, Franklin and Danville Railway Company.

Norfolk Southern Railway Company.

Northampton and Bath Railroad Company.

Norwood & St. Lawrence Railroad Company.

Ogdensburgh Bridge and Port Authonity.

Paducah & Illinois Railroad Company.

Pennsylvania and Atlantic Railroad Company (The Union

Transportation Company, Lessee ).

ennsylvania-Reading Seashore Lines.

Peoria and Pekin Union Railway Company.

Peoria Terminal Company.

d-37

Appendix 8

No. 35825

Statement of Flat and Proportional Rates from

Chicago, IIl., to New York (Domestic) with Applicable

“Pad” from March 1938, to Date (X-295-A)

Date Wheat Wheat Products

Flat Prop Pad Flat Prop Pad Rate Level

(1) (2) (3) (4) (8S) (6) (7) (8)

Mar. 28, 1938 345 2% is. «Ss 26.5 8.5 X-123, ICC 30

Jan. 21, 1947 40 30 10 405 WS 10 X-162,1CC 77!

Jan. 8, 1948 50 375 125 SOS 38 12.5 X-166, ICC 784

Sept. 26, 1949 565 415 14 56 42 14 X-168,. ICC 811

Apr. 5, 1956 62 465 185 62.5 47 15.5 X-175, ICC A-1076

Jul. 10, 1956 655 49 16.5 66 49.5 16.5 X-196, ICC A-1095

May 10, 1957 69 S15 175 695 §2 17.5 X-206, ICC A-1122

Oct. 18, 1957 71.5 S35 If 72 54 18 X-206-A, ICC A-113

Jun. 1, 1958 735 $5 185 90-74 $5.5 185 X-212. ICC A-1113

Mar. 10, 1960 67 $$ 12 67.5 $85 12 X-212

Oct. 24, 1960 68 555 125 685 %6 12.5 X-223, ICC 151

Aug. 19, 1967 70 575 125 75 58 12.5 X-256, ICC 281

Nov. 28, 1968 74 61 13 75 61 14 X-259-B, ICC 302

Nov. 18, 1969 78 6$ 13 80 65 1S X-262. ICC 312

Nov. 20, 1970 83 69 14 85 69 16 X-265-B, ICC 336

Apr. 12, 1971 92 7.5 155 945 765 18 X-267-B. ICC 343

Oct. 23, 1972 95 79 16 975 79 18.5 X-281-B. ICC 380

Aug. 19. 1973 98 815 165 1005 815 19 X-295-A. ICC 397

Tariff Authority: .

March 28, 1938 C.F.A. Tariff 245-F, ICC 3055—5%

Table Inc.

January 21, 1947 C.F.A. Tanff 245-G, ICC 3356—15%

Table Inc.

June 8, 1948 C.F.A. Tariff 245-G. ICC 3356—25%

Table Inc.

Sept. 26, 1949 C.T.R. Tariff 245-H, ICC 4403—10%

Table Inc.

April 5, 1956 C.T.R. Tanff 245-H, ICC 4403—12%

Table Inc.

d-38

July 10, 1956

May 10, 1956

October 18, 1957

June |, 1958

March 10, 1960

October 24, 1960

August 19, 1967

November 28, 1968

November 18, 1969

November 20, 1970

April 12, 1971

October 23, 1972

August 19, 1973

B-2

C.T.R. Tariff 245-H, ICC 4403—5%

Table Inc.

C.T.R. Tariff 245-H, ICC 4403—5%

Table Inc.

C.T.R. Tarnff 245-H.

Table Inc.

C.T.R. Tariff 245-H, ICC 4403—3%

Table Inc.

C.T.R. Tariff 245-H, ICC 4403—Sup. 150

( Reduction in Flat Rates )

C.T.R. Tariff 245-H, ICC 4403—.5 cent

Inc.*

TL/CTR Tariff 245-I, ICC C-375—2

cents Inc.

TL/CTR Tariff 245-I, ICC C-375—6%

Table Inc.

TL/CTR Tariff 245-1, ICC C-375—6%

Table Inc.

TL/CTR Tariff 245-I, ICC C-375—6%

Table Inc.

TL/CTR Taniff 245-I, ICC C-375—11%-

G Table Inc.

TL/CTR Taniff 245-1, ICC C-375—3%-G

Table Inc.

TL/CTR Taniff 245-1, ICC C-375—3%-G

Table Inc.

ICC 4403—9%

* § cent Increase in rates less than 65¢ cwt. and | cent

Increase in rates over 65¢ cwt.

d-39

C-1

Appendix C

Statement Showing Flat and

Proportional Rates

and Corresponding Pads on Wheat from

Chicago, Ill., to Eastern

Trunk Line Basing Points

from March 10, 1960, to August 19, 1973

(In Cents Per 100 Pounds)

Ex-Parte Increase Rate Level

295-

(1)

New York, N.Y. ..................

IG SHRI s -tunccndeinesseigpcreeenes

Balumore. Md. ....................

Belington, W Va. ................

Boston, Mass.

Cumberland. Md

Hagerstown, Md. ...............

Newport News, Va.

Philadelphia, Pa.

enonehlUmw?

onagmrenasg¢

vrTenrigdge

eo renereowmrmengreagensn

(2)

81.5

16.5

95 5

16.5

67.5

18.5

101.5

17.5

67.5

18.5

16.5

281- 267- 265- 262

B BB

(3) (4) (5) (6)

9 92 83 78

79 76.5 69 65

16 ISS 14 13

25 9 80 1%

76.5 745 66 63

16 ISS 14 13

91.5 89 79 7§

74 72 64 61

17.5 17 15 14

83.5 81 72 69

65.5 635 $7 $4

18 175 15 1S

985 955 8&5 Sl

81.5 79 70 67

17 165 1S 14

835 81 72 69

65.5 635 §7 54

18 ie 1S

91.5 89 79 75

74 72 64 61

17.5 17 15 14

91.5 89 79 75

74 72 64 6l

17.5 17 15 14

91.5 89 79 75

74 72 64 61

i75 17 1S 14

92.5 9 80 76

76.5 745 66 63

16 15.5 14 13

259-

223

(9)

55.5

12.5

$3.5

12.5

52.5

12.5

46.5

12.5

57.5

12.5

46.5

12.5

52.5

12.5

212

(10)

C-2

Ex-Parte Increase Rate Level

295- 281- 267- 265- 262 259- 256 223 212

To } + Sa eee

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

Rochester, N.Y. ........ cia a 885 86 83.5 75 71 67 63 61 60

b 705 685 665 60 57 54 50.5 485 48

18 17.5 17 1S 4 13 125 12.5 12

eee a 101.5 98.5 955 85 81 76 72 70 = 69

b 84 815 79 70 «8667~—63 $95 $75 57

ce 175 WW 16.5 15 14 13 125 125 12

ELI: uscomateiactiiabasie a 94 915 89 79 75 71 67 65 64

b 76 74 72 64 —s«6 | 58 $45 $2.5 §2

> 18 175 17 1S 14 13 25 12.5 12

SE ave a 885 86 83.5 75 71 67 63 61 60

b 705 685 665 60 $7 S54 SOS 485 “48

c 18 675 17 18 14 13 125 125 12

Utica. NY. cccccccccccccccocceee @ 895 87 845 76 72 68 645 625 61.8

b 715 695 675 61 S® SS 52 SO 495

a—Flat Rate

b—Proportional Rate

c—Pad

Tariff Authority: TPO B.B. Maurer, C/TN-245-I, [CC C-375

X-295-A —Eff. 8/19/73

X-281-B —Eff. 10/23/72

X-267-B —Eff. 4/28/73 (Increase Table—Supp. 307,

C/TN 245-1, ICC C-375)

X-265-B —Eff. 11/20/70

X-262 --Eif. !1/18/69

X-259-B —Eff. 11/28/68

X-256 —Eff. 8/19/67

X-223 —Eff. 7/1/63 (New Tariff Issue, TPO: H.R.

Hinsch C/TN 245-1, ICC C-375)

X-212 —Eff. 3/10/40 (Reduction In Flat Rate From

Chicago), TPO: H.R. Hinsch,

Freight Tariff 245-H, ICC 4403,

Supp. 193.

d-41

No. 35825

Appendix D

Statement Showing Flat and

Proportional Rates and Corresponding

Pads on Wheat Products from

Chicago, Illinois to Eastern

Trunk Line Basing Points

from March 10, 1960 to August 19, 1973

(In Cents Per 100 Pounds)

Ex Parte Increase Rate Level

295- 281- 267- 265- 262 259- 256 223 212

To A 8B B B oo

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

New York,NY... a2 1005 975 945 85 80 75 0S 685 675

b 815 79 76.5 69 65 61 58 56 55.5

c 19 18.5 18 16 1S 14 2$ 12.5 12

PEI, POT. ccccsisclarcaninessennind a 95 935 QI 82 77 73 68.$ 66.5 655

79 76.5 745 67 63 59 56 54 $3.5

¢ 175 17 16.5 15 14 i4 25 12.5 12

Baltuumore, Md... a 95.5 92.5 81 76 72 675 655 645

76 74 72 65 61 58 55 $3 $2.5

c 195 185 18 16 15 14 128 12.5 12

Belington, W Va. .......... a 86 83.5 81 73 69 65 615 S95 SRS

b 685 665 645 58 55 52 49 47 46.5

¢ 17.5 17 165 15 14 13 25 125 i?

a 1025 995 %.5 87 82 77 25 75 695

b 85 82.5 80 72 68 64 60 58 $7.5

¢ 175 17 16.5 15S 14 13 25 125 12

eee

Cumberland, Md. . a % 83.5 81 3 69 65 61.5 595 58.5

b 685 665 645 S58 55 52 a9 47 46.5

¢ 175 17 165 15S 14 13 2.56 12.5 12

955 925 9 81 %6 72 67.5 655 645

74 72 65 61 58 55 $3 52.5

c 195 185 18 16 ts 14 2.5 125 12

Hagerstown, Md.

955 925 9 8| 76 72 67.5 655 645

74 72 65 61 58 55 $3 52.5

c 195 WS 18 16 1S 14 12.5 125 12

Newport News, Va...

D-2

Ex Parte Increase Rate Level

——

295- 281- 267- 265- 262 259- 256 223 212

To A B B B B_.

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

eh, 9.5 925 9 81 16 72 675 655 645

b 76 74 72 65 61 58 55 53 $2.5

c 195 185 18 16 1S 14 2.5 12.5 12

Philadelphia, Pa. ................ a %5 935 91 82 77 «+73 685 665 655

b 79 5 1745 67 63 39 56 $4 $35

c 178 17 165 1S 14 14 125 125 12

Rochester, N.Y. 0.0.00. a 885 86 83.5 75 71 67 635 61.8 60.5

b 705 685 665 60 57 54 S| 49 48.5

c {8 17.5 17 1S 14 13 lan tas

Rockland, Me. 0.2.0.0... a 1025 995 95 87? 82 77 1725 05 695

b 85 825 80 72 68 64 60 S§ §75

c 178 17 6S 18 14 13 125 125 12

’

Strasburg, Va. 0... a 955 925 0 81 7% 72 675 65.5 645

c 195 185 1 6 8 4 125 125 22

ee a 885 86 835 75 71 67 63.5 61.5 605

b 705 685 665 60 $7 $4 St 49 48§

c 18 175 17 15) 14 13) 125 128 12

| SR a 95 88 855 77 73 69 6S 63 ~~ 62

b 7 +72 #0 63 $9 $6 $25 S05 $0

c 165 6 55 14 14 13 125 125 12

a—Flat Rate

b—Proportional Rate

c—Pad

Tariff Authority: TPO B.B. MAURER, C/TN 245-1, LC.C. C-375

X-295-A —Eff. 8/19/73

X-281-B —Eff. 10/23/72

X-267-B —Eff. 4/28/73 (Increase Table—Supp. 307,

C/TN 245-1, L.C.C. 375)

X-265-B —Eff. 11/20/70

X-262 —Eff. 11/18/69

X-259-B —Eff. 11/28/68

X-256 —Eff. 8/19/67

X-223 —Eff. 7/1/63 (New Tariff Issue, C/TN 245-I,

1.C.C. C-375) TPO: H. R. Hinsch

X-212 —Eff.3/10/60 (Reduction in Flat Rate From Chi-

cago),

TPO: H. R. Hinsch, Freight Tariff

245-H, I.C.C. 4403, Supp. 193

d-43

E-|

No. 35825

Appendix E

Statement Showing Flat and Reshipping Rates also

“Pads” from Chicago to Eastern Trunk Line Destinations on

Barley, Corn, Grain Sorghums and Oats

(In Cents Per 100 Pounds)

( Eff. 8-19-73) (Eff. 10-23-72) (Eff. 4-12-71)

X-295-A X-281-B X-267-B

(1) (2) (3) (4) (S$) (6) (7) (8) (9) (10)

Flat Res. Pad Flat Res. Pad Flat Res. Pad

SIA DE Gs sccetecicenenes 66 61 50 64 59 50 62 57.5 4.5

Baltuumore, MD. ........... . 65 $95 55 63 58 50 61 $6.5 4.5

Belington, W Va. ....... $3 48.5 45 $1.5 47 45 $0 455 45

ES vas ve 76.5 695 70 745 67.5 70

Cumberland, MD ......... 54 485 55 $2.5 47 55 S| 4855 55

Hagerstown,.MD....... 595 $3 6.5 58 $15 65 56.5 SO 6.5

New York, N.Y. ....... . 74 67.5 6.5 72 65.5 65 70 63.5 6.5

Newport News, Va. ... 74 67.5 6.5 72 65.5 6.5 70 63.5 65

Norfolk, Va. ......... 74 67.5 65 72 655 65 70 63.5 65

Philadelphia. Pa 685 64 45 665 62 45 645 60 45

Rochester, NY. ........ $3 485 45 $1.5 47 45 SO 455 45

Rockland. Me ............. 86 80.5 55 835 78 $.§ 81 79.5 435

Strasburg, Va. ae a 56.5 6.8 61 $5 6.0 59 §3.5 55

Syracuse, N.Y. ............ GS $3 $5 $7 51.5 55 55.5 50 $.5

Uuca. N.Y. .... 61 $4 70 59 $2.5 6.5 57.5 $1 6.5

Tariff Authority: TPO Maurer’s TL/CTR E-1009-A, ICC C-

391; TL/CTR E-772-G, ICC C-945

d-44

No. 35825

Appendix F

Statement Showing Proposed

Wheat and Wheat Producis Rates

from Chicago to Eastern Basing

Points Reflecting

the 6.5¢ cwt. “PAD”

(Cents Per 100 Pounds — X-295-A Level)

Wheat Wheat Products

Te _ Flat Prop Pad Fiat Prop Pad

(1) (2) (3) (4) (5) (6) (7)

New York, N_Y. 88 815 65 885 82 6.5

Albany, N.Y 845 78 65 &§ 78.5 65

Baltimore, Md 85 785 65 855 79 6.5

Belington, W. Va. 75 685 65 755 69 6.5

Boston. Ma. 90 835 65 95 84 6.5

Cumberland. Md. 75 685 65 755 69 6.5

Hagerstown, Md. 85 78.5 65 855 79 6.5

Newport News, Va. 85 78.5 65 85.5 79 6.5

Norfolk, Va. 85 785 65 855 79 6.5

Philadelphia, Pa. 86 795 65 865 80 6.5

Rochester, N.Y. 775 7I 6.5 78 71.5 65

Rockland, Me. 90 835 65 WS 84 65

Strasburg, Va. 85 785 65 855 79 6.5

Syracuse, N.Y 77.5 #71 65 78 71.5 65

Uuca. N Y 80 73$ 65 805 174 6.5

d-45

G-1

Appendix G

No. 35825

Statement Showing Wheat Receipts in Bushels at Chicago

For a Series of Years Via Rail,

Motor Carrier and Water, also

Percent of Total Via Each Mode

(000 Bushels Omitted)

Total % % Barge- %

Wheat Rail of Truck of Lake of

Year Receipts Receipts Total Receipts Total Receipts Total

(1) (2) (3) (4) (5) (6) (7) (8)

ae 17024 3780 22.2 11655 68.5 1589 93

nial 18502 3746 202 10015 54.1 4741 25.46

NE essence 20610 5049 245 6013 29.2 9548 46.3

ET enemies 20241 5697 28.1 8934 441 5610 27.7

FI sncossiin 26025 7628 29.3 10270 39.5 8127 31.2

FOEe eicies 35156 11358 32.3 12677 36.1 I1121 31.6

See 25986 9677 37.2 7847 30.2 8462 32.6

oe 30247 8639 28.6 7255 240 14353 47.5

| 33581 10864 32.4 9297 27.7 13420 40.0

I ssasitis 33481 11928 35.6 10451 31.2 11102 33.2

Source: Annual Statistics Chicago Board of Trade #

d-46

H-1

No. 35825

Appendix H

Statement of

Inbound Receipts of Wheat at

Dixie Portland Flour Mill, and Outbound

Shipments of Products Via Rail and Motor Carrier

(In Pounds 000 Omitted) :

Rail Truck Rail

Wheat Products Wheat Products Non-Transit

Receipts Shipments Receipts Shipments Shipments

i ccdaisnecnnasaiiie 272,484 187.642 144,384 246,390

St cddeiiinictiiteaesiin 243,289 154,388 108.401 222.091

er 163,428 136,188 353,412 273.953 $0,777

eee 214,943 100,847 241,109 309,330 42,048

ee ccdiiiniesintintin 46,070 50,931 132,720 182,717 10,397

Jan.-June.............

* Rail Shipment of Millfeeds Under Non Transit Mileage

Rates In

TPO: Maurer’s TL/CTR-E-772-G, ICC C-945.

d-47

No. 35825

Appendix I

Statement of Flat and Proportional Rates from

Chicago and Competitive Points to New York

(Domestic) together with Applicable Pad

Rates in Cents Per 100 Lbs. (Ex Parte 295-A Level)

Wheat

ee Peatects

Propor- Propor-

Flat tional Flat tional

Origin Rate Rate Pad Rate Rate Pad

Chicago. Ill. 98 81% 16% 100" Bi'r 19

Manitowac, Wis. 98 81's 16's 1002 8i': 19

Milwaukee, Wis. 98 8i's 16" 100'2 8i'2 19

Peora-Pekin. lil. (a) 119 (c) 86 33. (a) 119 (ce) 86 33

(b) 103'2 (c) 86 17's (b) 103% (c) 86 17";

Decatur. III (a) 119° (ec) 8 33, (a) 119) (ee) 86 33

(b) 103% (c) 86 17'y (b) 103'2 (c) 86 17!

Springtield. Ill. (a) 119° (ce) 86 33. (a) WIM (ey 86 33

(b) 103% (c) 86 17'> (b) 103% (cc) 86 17'y

East St. Louis Ill

St. Louis. Mo. (a) 119 90's 28'r (4a) 120 90': 29!,

(b) 103'» 90': 13 (b) 103! W'. 13

Quincy, Ill (a) 127 9): 36's (a) 128 W's 37!

(b) tl2 9O'> Ji'r (by) 112 9'> JI:

(a) Flat rate subject to comparable conditions as appli-

cable to Chicago flat rate.

(b) Flat rate subject to no more than two transit privileges

and non-application of Rule 24 of the Classification ( freight in

excess of full carload rule).

west Territory. The applicable proportional rate on traffic

originating in Northwest Territory ts the same as from Chicago,

Ill. viz: 81%.

Tariff Reference: TL-CTR TB 245-1, ICC C-375

d-48

No. 35825

Appendix J

Annual from Chicago Shipments of Wheat (Bushels)

(000 Omitted )

Year Lake Vessel Via

Canadian Overseas

US Ports Ports Ports Total Barge Rail Truck Total

a $,272 - 130 5,402 1.145 9275 22. 15.844

ee 4.698 2,604 $99 7.901 3.114 9,982 29 21,026

1964.0... 7,708 1,377 a 9.085 5.719 10,315 9 25,129

1965......... 10,315 3,878 168 14361 423. 7,151 | 21,936

1966......... 4.743 1185 * — 5.928 240 8494 26 14,688

a 8,404 189 88 8.681 2.109 5300 103 16,193

es. 5.798 212 $8 6,068 4.574 10,089 153 20,884

1969... 2,317 661 ime 2,978 1,838 7,456 47 12.319

1970......... 2,826 999 991 4816 — 6.742 31 11,589

eas 1,340 $50 1,064 «2,954 | 3.462 26 6,442

SOURCE: Annual Statistics Chicago Board of Trade

d-49

J-2

No. 35825

Annual Chicago Shipments of Flour (Sacks)

(000 Omitted)

VIA

Year Lake Vessel Barge Rail

1962 ........ 750 _ 6,258

EE ceseens -- — 6,733

1964 ........ — — 6,515

a — — 5,584

1966 ........ — — 5,857

1967 ........ — — 4,530

1968 ........ _ = 4,341

1969 ........ -- — 6,972

I chccisiiees —_ _ 6,912

= -- — 5,454

SOURCE:

Total

7,008

6,733

6,515

5,584

5,857

4,530

4,341

6,972

6,912

5,454

Annual Statistics Chicago Board of Trade

d-S0

No. 35825

Appendix K

Chicago-East Bound Rail Shipments of

Wheat and Flour — (1958-1966)

(000 Omitted)

Wheat Flour

Year (Bushel) (Sacks)

ores 2 9,293 2,842

| (aes 7,$52 1,739

| i ae 6,199 1,804

tte 4,864 1,804

| ae 3,468 1374

Se 1,529 1,203

a 679 954

a 2,353 771

DEED wcccccvccccsseseceseceece 133 841

SOURCE: Annual Statistics Chicago Board of Trade,

1966.

d-51

L-1

" No. 35825

Appendix L

Shipments of Wheat, Bran, Middlings, and Wheat Flour

Handled by B&O in 1972 from Origin Points in Illinois,

(including St. Louis, Mo.), Indiana, Michigan (lower penin-

sula) and Ohio, including the Buffalo, N. Y. area, and Destined

to Buffalo, Néw York, Pittsburgh, Pa., and Official Territory

Points East Thereof. An attempt was made to exclude export

traffic.

WHEAT —STCC NO. 01.-137-10

B&0

from Cars Tons = Revenue

Ihinots (including St. Louis, Mo). cede’ 720 = $ 11,396

INI sevcedsntnscchsscotecnets EE. AES a 10 498 3,877

Michigan (lower peninsula) - - --

Ohio entiond ii : 360 «29.563 238.090

Buffalo, N.Y Area - = — =

Total , _J81 30.778 $253,363

WHEAT FF! OUR—STCC NO, 20-411.10

Iilinous ( including St. Louis, Mo ) 251 49.763) §$ 62.561

Indiana .... 202 5,968 44.898

Michigan (lower peninsula) 98 = =3,003 24,358

Ohio sol 783 48.036 184,529

Buffalo, NY Area... 80S 26,176 _192,750

Total 2.139 89.946 — $509,096

MIDDLINGS—STCC NO. 20-412-10

Ilinois ( including St Louis, Mo ) 471,789 $13,178

Indiana , 3 193 1,168

Michigan (lower peninsula) 16 637 6.922

Ohw 464 17,947 37.190

Buffalo. N Y. Area _7t 2,887 _ 13,987

Total 601 23,453 72,415

d-52

L-2

BRAN-STCC NO. 20-412.20

From

——e

Ilinois ( including St. Louis. Mo. )

Indiana :

Michigan (lower peninsula )

_ Total...

Core

327

. 417

9.349

2,041

12,112

GRAIN FLOUR, NEC—STCC NO, 20-419-92

Iinoss ( including St. Louis, Mo )

Indiana (etieniauiiainas

Michigan ( lower peninsula)

Buffalo, N.Y. Area...

Total

FLOUR EDIBLE, NEC--STCC NO, 20-452.90

Iinous (including St. Louis, Mo )

Indiana .

Michigan ( lower peninsula)

Ohio .....

Buffalo. N.Y Area

Total

TOTAL WHEAT AND WHEAT PRODUCTS—YEAR

Iinoss ( including St. Louis, Mo )

Indiana stnideibahial

Michigan ( lower peninsula )

Ohio ,

Buffalo. NY. Area

GRAND TOTALS

10 287

5 144

109 6.795

124 7.196

225 8.8

5 129

10 338

iy 4824

S| a 416

410 3615 $37

$54 21,754

230 7042

131 4.192

2.162 113.514

995 32.520

407?

d-53

179.022

B40

Rev enue

$ 6.637

610

11,397

9.887

$28,531

3,306

$ -343

$ 72.205

1,746

3.761

23.402

10,704

ort.

1972

$168.97?

$3,730

36.573

491.202

227.298

$974 7RO

No, 35825

Appendix M

Breakdown of Tonnage and Revenue Figures Contained

In Verified Statement of T. E. Sellinger (Exhibit 11)—

By State of Origin and Commodity (Penn Central-1972)

Origins Commodity Cars' Tons Rev enue

Ihinow Wheat 69 4,284 48.917

(O1-137-10)

(Includes

St. Louis. Mo ) Wheat Flour 2.449 104.354 1.276.934

(20-411-10)

Semolina & y 428 6.131

Flour Mixture

(20-411-15)

Wheat Middlings 218 8.885 77.716

or Shorts

(20-412-10)

Wheat Bran & 0 825 6,182

2'o% other

ingredients

(20-412-15)

Wheat Bran 9 1.128 11.028

(20-412-20)

‘ All shipments of wheat to Albany, Baltimore, and Nor-

folk were eliminated so as to exclude export traffic. Some

domestic traffic could have been also eliminated. The same

procedure was not followed in connection with the figures on

flour because New York City receives a great deal of domestic

flour. However, apparently\there are no flov’ mills in Phila-

delphia, Baltimore, and Norfolk.

d-54

M-2

Origins Commodity Cars Tons Revenue

Compound Flour, 65 2,021 27,383

Grain with other

ingredients not

exceeding 40%

(20-452-30)

Flour, edible 915 27,923 191,193

NEC

(20-452-9)

TOTALS 3,894 149.745 1.845.538

Indiana Wheat wn 8 11,103 138.919

(O1-137-10) ”

Wheat Flour 1,354 46,543 285.363

(20-411-10)

Semolina & | 27 49

Flour Miature

(20-411-15)

Semolina | 42 193

(20-411-25)

Wheat Middlings 107 4,521 28,338

or Shorts

(20-412-10)

Wheat Bran 4 128 1.400

(20-412-20)

Flour, edible 234 6.763 41,158

NEC

(20-452-90)

TOTALS 1.807 69.127 495.6:9

Michigan Wheat 22 ju 10,835

( Lower (O01-137-10)

Peninsula)

Wheat Flour 1.811 69.91) 440 285

(20-411.10)

d-55

Oho

M-3

Commodity

Wheat Middlings

or Shorts

(20-412-10)

Wheat Bran

(20-412-20)

Compound, Flour,

grain with other

ingredients not

exceeding 40%

( 20-452.)

Flour, edible

NEC

(20-452.90)

TOTALS

Wheat

(O1-137-10)

Wheat Flour

(20-411-10)

Semolina &

Flour Mixture

(220-411-158)

Semolina

(20-411-25)5

Wheat Middlings

or Shorts

(20-412-10)

Wheat Bran &

29% other

ingredients

(20-412-18)

Wheat Bran

(20-412.20)

d-56

289

3.728

1.414

1,729

1,205

$53

7,683

20,142

3,093

144.550

109.082

92.474

183

135

50.959

115

18,748

Revenue

——————

185,583

31,786

187,264

23,785

819 538

1,106,389

456.417

231.573

77.618

New York

Only

Buffalo

Niagara Falls

Lockport

M-4

Commodity

Compound, Flour,

grain with other

ingredients not

exceeding 40%

(20-452-30)

Flour, edible

NEC

(20-452-90)

TOTALS

Wheat

(01-137-10)

Wheat Flour

(20-411-10)

Semolina &

Flour Mixture

(20-411-15)

Semolina

(20-411-25)

Wheat Middlings

or Shorts

(20-412-10)

Wheat Bran

(20-412-20)

Compound, Flour.

grain with other

ingredients not

exceeding 40%

( 20-452-30)

Flour, edible.

NEC

( 20-452-90)

TOTALS

GRAND TOTALS

d-57

Cars

336

5,258

249

16,184

335

442

19.866

34.553

9,797

278.468

18.403

603,076

206

2.215

105,765

10,293

16.489

756.509

1,398,399

Revenue

116

132,269

2,007,797

116,569

4,164,998

1.913,

19.246

770.978

66.519

764

64,330

§.205.317

10,.373.809

Appendix N

No. 35825

Tonnage of Wheat and Wheat Products Originated in

1972 at Principal Points in the States Named in the

Verified Statement of T. E. Sellinger (Exhibit 11),

Including Revenue Derived Therefrom (Penn Central)

Origin

Chicago

Peona, Ill.

Commodity

Wheat

01-137-10

Wheat Flour

20-411-10

Semolina &

Flour Mixture

20-411-15

Wheat Middlings

or Shorts

20-412-10

Wheat Bran

20-412-20

Compound Flour

grain with other

ingredients not

exceeding 40%

20-452-30

Flour, edible,

NEC

20-452-90

TOTAL

Wheat Flour

20-4!1-10

Semolina &

Flour Mixture

20-411-15

Cars

141

345

Tons

2,615

5,970

211

1,125

650

8,747

26,720

153

Revenue

29,261

80,238

2,804

62,815

11,028

8,574

148.855

343,575

2.245

Springfield,

Il.

Indianapolis

N-2

Commodity

Flour, edible,

NEC

20-452-90

TOTAL

Wheat Flour

20-41 1-10

Semolina &

Flour Mixture

20-41 1-15

Wheat Middlings

or Shorts

20-412-10

Wheat Bran &

2'’%% other

ingredients

20-412-15

Flour, edible.

NEC

20-452-90

TOTAL

Wheat

01-137-10

Wheat Flour

20-41 1-10

Semolina &

Flour Mixture

20-41 1-15

Wheat Middlings

or Shorts

20-412-10

Flour, edible,

NEC

20-452-90

TOTAL

d-59

Cars

1.024

1.116

27.389

779

825

8.295

37.334

743

35,898

3.301

40 051

Revenue

755

3,600

215,254

998

6,386

6,182

73,103

301.923

10.251

127,868

17,173

1$5.507

Origins

Chelsea, Mi.

Detroit, Mi.

Hillsdale, Mi.

N-3

Quay

Wheat Flour

20-411-10

Wheat Middlings

or Shorts

20-412-10

Wheat Bran

20-412-20

TOTAL

Wheat Flour

20-411-10

Wheat Middlings

or Shorts

20-412-10

TOTAL

Wheat Flour

20-41 1-10

Wheat Middlings

or Shorts

20-412-10

Wheat Bran

20-412-20

Compound, Flour

grain with other

ingredients not

exceeding 40%

20-452-30

. Flour, edible,

NEC

20-452-90

TOTAL

d-60

138

267

375

875

608

347

255

676

1,899

9,247

146

13,352

19,065

15,910

6,517

20,480

448

64,038

18,452

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