Petition — Kansas City Southern Railway Co. v. Great Lakes Carbon Corp.

Supreme Court, U.S.

FILED

80-413 SEP 13 1980

-MICHAEL RODAK, Jr, CLERK

In the Supreme Court of the United States

October Term, 1980

THE KANSAS CITY SOUTHERN

RAILWAY COMPANY,

Petitioner,

VS.

GREAT LAKES CARBON CORPORATION,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

ROBERT K. DREILING

(Counsel of Record)

114 West 11th Street

Kansas City, Missouri 64105

JOHN P. EMDE

611 Olive Street

Suite 1950

St. Louis, Missouri 63101

Attorneys for Petitioner. The Kansas

City Southern Railway Company

E. L. MENDENHALL, INc., 926 Cherry Street, Kansas City, Mo. 64106, (816) 421-3030

QUESTIONS PRESENTED

1. Whether the Urgent Deficiencies Act (28 U.S.C.

$§2321 et seq.) requires that an action to set aside a final

order of the Interstate Commerce Commission be brought

against the United States of America when the Commis-

sion’s Order arises from a referral to it of a question or

issue by a United States District Court and when such

action is brought before the referring court pursuant to

the terms of Section 1336(b) of Title 28 of the United

States Code.

2. Whether the failure to bring an action to set aside

a final order of the Interstate Commerce Commission

against the United States of America is a procedural defect

fatal to the reviewing Court’s jurisdiction.

3. Whether a judgment setting aside a final order

of the Interstate Commerce Commission is void for the

purposes of Rule 60(b) (4) of the Federal Rules of Civil

Procedure when the action seeking to have the Commis-

sion’s Order set aside has not been brought against the

United States of America.

4. Whether a party can be held to have waived its

remedy to have a void judgment set aside under Rule

60(b) (4) by its failure to raise the issue of the voidness

of the judgment in a timely prosecuted appeal.

III

TABLE OF CONTENTS

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STATUTORY PROVISIONS INVOLVED ........................ 2

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REASONS FOR GRANTING PETITION .............0000....... 6

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Table of Authorities

CasEs CITED

B. F. Goodrich Co. v. Northwest Industries, Inc., 424

F.2d 1349 (3rd Cir. 1970), certiorari denied, 400 U.S.

ea ac diationibii cha pduscineindonmabcmmsselouiees 6

Schwartz v. Bowman, 244 F.Supp. 51 (D.C.N.Y. 1965),

affirmed, 360 F.2d 211, certiorari denied, 385 U.S.

EEL EETES SAE ed OR a a 6

State of North Dakota ex rel. Lemke v. Chicago & N.W.

Ry., 257 U.S. 485, 42 S.Ct. 170 (1922). ...................0....0.. 7

STATUTES AND RULES CITED

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EE) 2,6

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Rule 35(a), Federal Rules of Appellate Procedure ........ 8

Rule 60(b) (4), Federal Rules of Civil Procedure ........ 3, §,6,

7,8

PREVIOUS PAGE WAS BLANK |

In the Supreme Court of the United States

October Term, 1980

4

THE KANSAS CITY SOUTHERN

RAILWAY COMPANY,

Petitioner,

vs.

GREAT LAKES CARBON CORPORATION,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

The petitioner, The Kansas City Southern Railway

Company, respectfully prays that a writ of certiorari issue

to review the judgment and opinion of the United States

Court of Appeals for the Eighth Circuit entered in this

proceeding on June 16, 1980

OPINIONS BELOW

The opinion of the United States Court of Appeals for

the Eighth Circuit in The Kansas City Southern Railway

Company v. Great Lakes Carbon Corporation, Case No.

79-1075, entered upon rehearing on June 16, 1980, has not

yet been reported and appears in the Appendix hereto.

Similarly, the opinion of the panel of the Court of Appeals,

entered on September 24, 1979; and the Order of the

2

district court denying plaintiffs’ motion under Rule 60(b)

(4) and its final judgment, entered in The Kansas City

Southern Railway Company v. Great Lakes Carbon Cor-

poration, Civil Action No. 75-808C(3) appear in the Ap-

pendix. Both the initial and final decisions of the Inter-

state Commerce Commission, entered in I.C.C. Docket No.

36406, Petition for Declaratory Order - Great Lakes,Carbon

Corporation - Petroleum Coke, also appear in the Appendix.

JURISDICTION

The judgment on rehearing of the Court of Appeals

for the Eighth Circuit was entered on June 16, 1980, and this

petition for certiorari was filed within 90 days of that

date. This Court’s jurisdiction is invoked under 28 U.S.C.

§1254(1).

STATUTORY PROVISIONS INVOLVED

United States Code, Title 28:

§1336(b). Interstate Commerce Commission Orders.

(b) When a district court or the Court of Claims

refers a question or issue to the Interstate Commerce

Commission for determination, the Court which re-

ferred the question or issue shall have exclusive juris-

diction of a civil action to enforce, enjoin, set aside,

annul, or suspend, in whole or in part, any order of

the Interstate Commerce Commission arising out of

such referral.

§2321(a) and (b). Judicial Review of Commission’s

orders and decisions; procedure generally; process.

(a) Except as otherwise provided by an Act of

Congress, a proceeding to enjoin or suspend, in whole

or in part, a rule, regulations, or order of the Inter-

3

state Commerce Commission shall be brought in the

Court of Appeals as provided by and in the manner

prescribed in Chapter 158 of this title.

(b) The procedure in the district courts in ac-

tions to enforce, in whole or in part, any order of the

Interstate Commerce Commission other than for the

payment of money or the collection of fines, penalties,

and forfeitures, shall be as provided in this Chapter.

§2322. United States as party.

All actions specified in Section 2321 of this title shall

be brought by or against the United States.

Federal Rules of Civil Procedure Rule 60(b).

Relief from Judgment or Order.

(b) Mistakes; Inadvertence; Excusable Neglect;

Newly Discovered Evidence; Fraud, etc. On motion

and upon such terms as are just, the court may relieve

a party or his legal representative from a final judg-

ment, order, or proceeding for the following reasons:

(1) mistake, inadvertence, surprise, or excusable ne-

glect; (2) newly discovered evidence which by due

diligence could not have been discovered in time to

move for a new trial under Rule 59(b); (3) fraud

(whether heretofore denominated intrinsic or extrin-

sic), misrepresentation, or other misconduct of an ad-

verse party; (4) the judgment is void; (5) the judg-

ment has been satisfied, released, or discharged, or a

prior judgment upon which it is based has been re-

versed or otherwise vacated, or it is no longer equitable

that the judgment should have prospective application;

or (6) any other reason justifying relief from the

operation of the judgment. The motion shall be made

within a reasonable time, and for reasons (1), (2),

and (3) not more than one year after the judgment,

4

order, or proceeding was entered or taken. A motion

under this subdivision (b) does not affect the finality

of a judgment or suspend its operation. This rule does

not limit the power of a court to entertain an inde-

pendent action to relieve a party from a judgment,

order, or proceeding, or to grant relief to a defendant

not actually personally notified as provided in Title

28, U.S.C., §1655, or to set aside a judgment for fraud

upon the court. Writs of coram nobis, coram vobis,

audita querela, and bills of review and bills in the

nature of a bill of review, are abolished, and the pro-

cedure for obtaining any relief from a judgment shall

be by motion as prescribed in these rules or by an in-

dependent action.

STATEMENT OF THE CASE

This case arises out of a dispute between the parties

as to the proper railroad freight charges due petitioner

(“KCS”) under its published tariff. KCS filed an action

in the United States District Court (W.D. Mo.) for re-

covery of unpaid freight charges it claimed due from

Great Lakes Carbon Corporation (‘Great Lakes Car-

bon”). Jurisdiction was invoked under 28 U.S.C. $1337.

Great Lakes Carbon in turn counterclaimed for recov-

ery of charges it claimed to have overpaid KCS. Be-

cause the case involved issues of tariff interpretation and

of the applicability and lawfulness of the railroad freight

rates at issue, the trial court stayed the proceedings before

it and directed the parties to seek a declaratory order

from the Interstate Commerce Commission on these issues.

Pursuant to the court’s directive, the parties filed their

respective petitions for declaratory order with the In-

terstate Commerce Commission. Full proceedings were

had before the Commission culminating in the final order

5)

of the Commission, entered on October 7, 1977 in I.C.C.

Docket No. 36406 (Petition for Declaratory Order - Petro-

leum Coke) and I.C.C. Docket No. 36406 (Sub-No. 1) (Peti-

tion for Declaratory Order - Kansas City Southern). In

short, the Commission’s final order upheld KCS’ interpreta-

tion of the tariff and its application of the rates therein pub-

lished.

Having obtained the declaratory order, the parties re-

turned to the trial court which had referred the issues

to the Interstate Commerce Commission. KCS filed its

motion for summary judgment wherein it requested the

court to enter a money judgment consistent with the Com-

mission’s order. Great Lakes Carbon, on the other hand,

also filed a motion for summary judgment wherein it re-

quested that the Court accept the Commission’s tariff in-

terpretation insofar as KCS’ Complaint was concerned but

that the court disregard that interpretation with respect

to its counterclaim. Great Lakes Carbon neither brought

this action to set aside the Commission’s order against the

United States of America nor did it seek joinder of the

United States of America as an additional party defendant.

On April 25, 1978, the trial court entered its judg-

ment sustaining KCS’ motion for summary judgment on its

Complaint but also sustaining Great Lakes Carbon’s Sum-

mary Judgment Motion on its Counter-claim; the first con-

sistent with the Interstate Commerce Commission’s final

order but the latter in contradiction thereto.

KCS did not timely appeal the trial court’s judgment.

However, on October 31, 1978, KCS filed a motion under

Rule 60(b) (4) of the Federal Rules of Civil Procedure, seek-

ing to have the judgment as to Great Lakes Carbon’s Coun-

ter-claim set aside for the reason that the court lacked

requisite jurisdiction to set aside the Commission’s order

for failure to join the United States of America as an

6

additional party defendant and that the judgment as to the

counterclaim was thus void. By Order dated December

21, 1978, the trial court summarily denied the 60(b) (4)

motion.

KCS appealed that order to the Eighth Circuit Court

of Appeals. On September 24, 1979, a panel of that court

reversed the trial court and remanded the case. However,

upon rehearing, the court en banc entered its decision

which is the subject matter of this petition.

REASONS FOR GRANTING PETITION

I. The Decision Conflicts With Decisions of

Other Circuits As to the Proper Interpretation of

the ‘‘Urgent Deficiencies Act’? Requiring That the

Conflict Be Settled by This Court.

The exclusive procedure for review of a final order of

the Interstate Commerce Commission by a referring court

is that set forth in the “Urgent Deficiencies Act” (28 U.S.C.

§§2321 et seq.) B. F. Goodrich Co. v. Northwest Industries,

Inc., 424 F.2d 1349, 1353 (3rd Cir. 1970), certiorari de-

nied, 400 U.S. 822. The remedy is so exclusive that the

Commission’s order cannot be attacked unless all the re-

quirements have been met, including that of bringing the

action against the United States of America. Schwartz v.

Bowman, 244 F.Supp. 51 (D.C.N.Y. 1965), affirmed, 360

F.2d 211, certiorari denied, 385 U.S. 921. Failure to at least

join the-United States of America as an additional party

defendant is a procedural defect fatal to the court’s juris-

diction. Schwartz v. Bowman, supra, at 68.

The instant decision is in conflict with both the letter

and the spirit of those rulings. It disregards the statutory

scheme for review of Commission orders. It fails to recog-

nize the Congressional intent that the United States par-

7

ticipate in such proceedings to preserve the public interest.

In short, it will allow private litigants, through inadver-

tence or device, to disregard and thereby thwart the legiti-

mate exercise by the Interstate Commerce Commission of

its jurisdictional grant and the exercise of its function as

a monitor of the public interest in the regulatory scheme.

See: State of North Dakota ex rel. Lemke v. Chicago &

N.W. Ry., 257 U.S. 485, at 490, 42 S.Ct. 170, at 171 (1922).

The decision at least requires review by this court. In

reality, however, it so places in question the interpretation

of the “Urgent Deficiencies Act” as to require resolution

by this court.

II. The Decision so Countenances Unwarranted

Acquisition and Exercise of Jurisdiction by the

Trial Court As to Require Exercise by This Court

of Its Supervisory Function.

When this court is presented questions involving the

exercise by the lower federal courts of jurisdiction, it has

a dual role: that of interpreter of the law and that of

supervisor of the conduct of those lower federal courts.

The instant case presents an issue as to the proper exercise

of jurisdiction by a district court in an area in which that

jurisdiction is clearly limited by statute. Insofar as the

decision acquiesces in the district court’s exercise of juris-

diction under questionable circumstances, guidance is

needed from this court as to whether that activity was

proper.

III. The Decision Renders Rule 60(b)(4) a Nullity

Calling for Exercise by This Court of Its Powers

of Supervision.

The decision holds that, even though the trial court

may have erred in interpreting the statutory prerequisites

to its jurisdiction, it can rely upon that error as the basis

for jurisdiction it otherwise does not possess. Thus, the

Court of Appeals reasons, failure to raise that error on

appeal lends it a legitimacy it would not otherwise have

and grants the court jurisdiction otherwise unlawful.

With the sole exception of fraud in procurement,

there exists no other reason for finding a judgment void

than the trial court’s lack of jurisdiction. Rule 60(b) (4)

of the Federal Rules of Civil Procedure is an exceptional

remedy which may be raised at any time, either before or

after a judgment has become final. However, in this re-

gard, the instant decision makes Rule 60(b) (4) unavailable

to attack judgments void for lack of jurisdiction unless

the issue is preserved for appeal or the motion is made

prior to the judgment becoming final. As such, it renders

Rule 60(b)(4) a nullity requiring this court’s exercise

of its supervisory powers to preserve the integrity of the

rule and to govern the lower courts’ administration of it.

IV. The Fact That Rehearing Was Granted and

the Decision Rendered En Banc Demonstrates the

Imrcrtance of the Issues and the Need for Review

by This Court.

Rule 35(a) of the Rules of Appellate Procedure

(F.R.A.P. Rule 35(a), 28 U.S.C.) provides:

(a) When Hearing or Rehearing in Banc Will be

Ordered. A majority of the circuit judges who are in

regular active service may order that an appeal or

other proceeding be heard or reheard by the court of

appeals in banc. Such a hearing or rehearing is not

favored and ordinarily will not be ordered except (1)

when consideration by the full court is necessary to

secure or maintain uniformity of its decisions, or (2)

when the proceeding involves a question of excep-

tional importance.

Inasmuch as the Court of Appeals below granted re-

hearing, it must be assumed that the court considered that

the proceeding involved questions of exceptional impor-

tance. But the question must be asked whether the de-

cision adequately resolves that question. Four members

of the court voted with the majority. Of these, three

joined in the majority opinion and one concurred on un-

related grounds. Three members of the court expressed a

very strong dissent. The decision involves such a division

of opinions on issues of exceptional importance as to re-

quire ultimate resolution by this Court.

CONCLUSION

For these reasons, a writ of certiorari should issue to

review the judgment and opinion of the Eighth Circuit.

Respectfully submitted,

RoBeErT K. DREILING

114 West 11th Street

Kansas City, Missouri 64105

Phone: (816)-556-0392

JOHN P. EMpE

611 Olive Street

Suite 1950

St. Louis, Missouri 63101

Attorneys for Petitioner

10

CERTIFICATE OF SERVICE

I hereby certify that on this 12th day of September,

1980, three copies of the Petition for Writ of Certiorari

were mailed, postage prepaid, to Fordyce & Mayne, G.

Carroll Stribling, 120 South Central Avenue, Suite 1100,

Clayton, Missouri 63105, Counsel for Respondent.

RosBert K. DREILING

114 West 11th Street

Kansas City, Missouri 64105

Phone: (816)-556-0392

Counsel for Petitioner

Al

APPENDIX

MEMORANDUM

(Fileé April 25, 1978)

This matter is before the Court upon defendant’s motion

for summary judgment on a counterclaim. The plaintiff,

The Kansas City Southern Railway Company (KCS), filed

a claim for undercharges against the defendant Great Lakes

Carbon Corporation (Great Lakes). Great Lakes filed a

counterclaim for overcharges against KCS.

At the request of both parties, the district court referred

the matter to the Interstate Commerce Commission for

adjudication. With regard to the plaintiff’s claim, the Ad-

ministrative Law Judge found that KCS applied the lawful

tariff, and that its interpretation of the tariff was correct.

However, the rate assessed by KCS was found to be unjust

and unreasonable. Great Lakes’ interpretation of the tariff,

the basis of the counterclaim, was found to be incorrect.

The ICC affirmed and adopted the decision of the Admin-

istrative Law Judge. Neither party exercised its statutory

right of appeal to the ICC or the United States Court of

Appeals. Both parties agree that the primary claim has

been resolved and is no longer at issue. Under that claim

plaintiff is entitled to a judgment of Twenty Nine Thousand,

Eight Hundred Ninety Eight Dollars, Thirty Two Cents

($29,898.32).

The Court must now determine whether the decision

of the ICC on the counterclaim is binding. KCS claims

that it is and the doctrine of res judicata applies as the de-

cision of the ICC was final. Great Lakes asserts that the

decision of the ICC is not binding because the issue was not

within the primary jurisdiction of that agency, that the

doctrine of res judicata is irrelevant, and that the Court

may consider the matter de novo.

A2

What is involved here are shipments of petroleum

coke from Chaison, Texas to Steeltown, Texas. KCS, the

carrier, billed Great Lakes, the shipper, according to rates

set out in the Texas-Louisiana Freight Bureau Tariff.

Tariffs are promulgated under the auspices of the ICC. In

this tariff there is no specific rate stated between Chaison

and Steeltown. Item 216 permits the shipper to apply either

the rate from Chaison to Port Arthur or the rate from

Chaison to Beaumont.' Item 70 of the tariff states that

the lower of any two rates must apply. ;

Section 2 of the tariff sets out specific commodity

rates for petroleum coke from, Chaison to Port Arthur.

It is applicable (as KCS claims) unless there is another

and lower rate which is also applicable to the Chaison

to Steeltown movement. Section 4 of the tariff provides

rates from Chaison to Beaumont. This rate is lower than

the rate in §2. However, §4 does not apply specifically

to petroleum coke, but to “freight all kinds”:

Rates referring hereto apply on FREIGHT ALL

KINDS, consisting of a mixture of two or more

commodities in the next phrase except as shown in

NOTES 1 and 2 and as follows:

Column 1 rates are in cents per car and apply

on ALL COMMODITIES.

Column 2 rates are in cents per car and apply

on FREIGHT ALL KINDS and apply on import

traffic. (emphasis added).

As “freight all kinds” is defined as a mixture of two

or more commodities, a shipment consisting entirely of

1. The item provides:

“Rates named in this tariff, as am applying on

bulk “ns to Beaumont or Port Arthur, or export

on the KCS will also apply to Steeltown, TX, for export

on the KCS.”

A3

petroleum coke does not fall under the first paragraph

of $4. Great Lakes contends that the exception for all

commodities plainly includes petroleum coke because the

restriction that there be a mixture of two or more com-

modities does not apply. That is, the term ‘all commod-

ities” includes shipment of a single commodity such as

petroleum coke. The ICC disagreed and found that the

$4 rate applicable to “all ccmmodities” only applies to

mixtures of two or more commodities, not shipments made

entirely of petroleum coke.

The doctrine of primary jurisdiction determines

whether a court or agency will initailly decide a particular

question. It is not an abdication by the court to the

agency; rather it is a deferral. It is often invoked when

the specialized knowledge of the agency is necessary for

a more informed determination of the issue. However,

as stated in 3 K. Davis, Administrative Law §19.01 at

p. 5 (1958):

The principal reason behind the doctrine of pri-

mary jurisdiction is not and never has been the idea

that “administrative expertise” requires a transfer of

power from courts to agencies, although the idea of

administrative expertise does to some extent contrib-

ute to the doctrine. The principal reason behind the

doctrine is recognition of the need for orderly and

sensible coordination of the work of agencies and of

courts. Whether the agency: happens to be expert

or not, a court should not act upon subject matter

that is peculiarly within the agencies’ specialized field

without taking into account what the agency has to

offer, for otherwise parties who are subject to the

agencies’ continuous regulation may become the vic-

tims of uncoordinated and conflicting requirements.

A4

Questions involving complex technical fact situations

are often within the primary jurisdiction of agencies.

Those questions involving legal issues are within the pri-

mary jurisdiction of the courts. If an agency decides

a legal: issue, not within its primary jurisdiction, the court

is not bound by its determination. In this case, if the

application of the tariff is determined to be a legal issue

the court is free to follow or disregard the decision of

the ICC. On the other hand, if this tariff interpretation

involves technical issues, the commissioner’s decision must

be followed.

In transportation cases, the specialized knowledge of

the ICC is often necessary to interpret ambiguous terms

of a tariff or determine the reasonableness of rates. When

words in a tariff are used in a technical sense, or extrinsic

evidence is necessary to determine their meaning, the pri-

mary jurisdiction of the ICC is invoked. Great Northern

Railway Company v. Merchant’s Elevator Co., 259 US.

285 (1922); U.S. v. Western Pacific Railroad, 352 U.S.

59 (1956). However, when words are used in an ordinary

non-technical sense, involving only questions of law, the

issue of tariff construction may be decided by the courts.

The terms to be construed here are “freight all kinds”

and “all commodities’. These words are used in an ordi-

nary sense. Interpretation does not require the technical

expertise of the ICC nor the gathering of extrinsic evi-

dence. The opinion of the ICC is instructive:

The difficulty with the shipper’s position lies in

the fact that the lower freight-all-kinds rates in section

4 of the tariff applied to mixtures, not shipments of

single commodities such as petroleum coke. Also the

specific commodity rates in section 2 of the tariff

did not alternate with other rates. Taken together,

A5

these provisions negate the shipper’s arguments as

to the applicability or violation of section 4 of the

Act, and there was no violation of tariff circular 20

since only the rates in section 2 of the tariff were

applicable to the traffic at issue. ICC Decision No.

36-406 (March 22, 1977).

In determining that the lower freight all kinds rate

did not apply to shipments of single commodities the Ad-

ministrative Law Judge did not draw on specialized know-

ledge of transportation matters. Extrinsic evidence was

not gathered to aid an interpretation of the rates. More-

over, the purpose of the tariff is clear and may be construed

without reference to underlying costs allocation factors.

Louisville & Arkansas Railway v. Expert Drum Co., 359

F.2d 311 (5th Cir. 1966).

The District Court may clearly interpret these non-

technical terms. As to the issue of whether the freight

all kinds rate applies, the commission does not have pri-

mary jurisdiction: and its decision is not binding upon

this Court. Thus, Great Lakes’ counterclaim will be con-

sidered on its merits.

Section 2 of the tariff is clearly applicable to the

shipments in question as it sets out specific rates for petro-

leum coke. However, section 4 sets out lower rates and

should be applied if it is found to include shipments of

petroleum coke alone.

Section 4 applies to shipments of “freight all kinds”.

That term is defined as a mixture of “two or more com-

modities” and in general does not include shipments of

petroleum coke, a single commodity. However, §4 con-

tains an exception: Certain rates apply to “all commodi-

ties”. At issue is whether “all commodities” is synonymous

with “freight all kinds” and is limited to mixtures of

A6

two or more commodities as well. It is this Court’s opinion

that it is not.

If it were intended that $4 rates were to apply only

to “freight all kinds” there wou!d be no need for an excep-

tion. Rules of statutory construction require that a word

or phrase be interpreted to have some meaning if such

an interpretation is reasonable. Burrow v. Finch, 431 F.2d

486 (8th Cir. 1970). Accordingly, the Court finds that

the term ‘all commodities” is not the same as “freight

all kinds” and includes shipment of petroleum coke. Thus,

Great Lakes was overcharged and is entitled to summary

judgment.

Dated this 25th day of April, 1978.

/s/ H. Kenneth Wangelin

H. Kenneth Wangelin

United States District Judge

ORDER

(Filed April 25, 1978)

In accordance with the Memorandum of this Court

filed this date and incorporated herein,

IT IS HEREBY ORDERED that plaintiff’s motion for

summary judgment on plaintiff's complaint be and is

GRANTED; and

IT IS FURTHER ORDERED that defendant’s motion

for summary judgment on defendant’s counterclaim be

and is GRANTED; and |

IT IS FURTHER ORDERED, ADJUDGED AND DE-

CREED that plaintiff have judgment against defendant

on plaintiff’s complaint in the amount of Twenty Nine

Thousand Eight Hundred Ninety Eight Dollars and Thirty

A7

Two Cents ($29,898.32) plus interest at the rate of six

per cent (6%) per annum from August 31, 1974; and

IT IS FURTHER ORDERED, ADJUDGED AND DE-

CREED that defendant have judgment against plaintiff

on defendant’s counterclaim in the amount of One Hundred

Twenty Nine Thousand Twenty Six Dollars and Forty

Nine Cents ($129,026.47) plus interest at the rate of six

per cent (6%) per annum from the date of overpayment

as reflected by joint Exhibit A; and

IT IS FURTHER ORDERED that the parties pay their

own costs in this action.

Dated this 25th day of April, 1978.

/s/ H. Kenneth Wangelin

H. Kenneth Wangelin

United States District Judge

A8

MEMORANDUM AND ORDER

(Filed December 21, 1978)

This matter is before the Court upon plaintiff's motion

under Rule 60(b) of the Federal Rules of Civil Procedure

for relief from the judgment and order of this Court filed

April 25, 1978. Plaintiff in its motion contends that this

Court did not have jurisdiction to try defendant’s claims

against plaintiff. The basis of plaintiff's motion addresses

issues thoroughly considered by this Court in its opinion

filed April 25, 1978, and from which plaintiff took no

appeal.

After thorough reconsideration of the matter, this

Court finds that plaintiff's motion is without merit. Con-

sequently, plaintiff's motion for relief under Rule 60(b) (4)

will be and is DENIED.

It is so Ordered.

Dated this 21st day of December, 1978.

/s/ H. Kenneth Wangelin

H. Kenneth Wangelin

United States District Judge

A9

Exhibit ‘‘1”’

INTERSTATE COMMERCE COMMISSION

INITIAL DECISION

No. 36406*

PETITION FOR DECLARATORY

GREAT LAKES CARBON CORPORATION ~

PETROLEUM COKE

(Service Date March 31, 1977) ™\

1. Assailed rates and charges on shipments of petroleum

coke in Texas from Chaison to Steeltown for export

found to have been applicable, just and reasonable.

2. Sought rates and charges on export shipments of pe-

troleum coke in Texas from Port Arthur to Steeltown

found to have been applicable but not just and rea-

sonable, to the extent they exceeded those in No. 1,

above.

3. Proceedings discontinued.

Dickson R. Loos and Barry Roberts for the shipper, Great

Lakes Carbon Corporation.

Robert X. Dreiling and Robert E. Zimmerman for the rail

carrier, The Kansas City Southern Railway Company.

By Richard McG. Wilkins, Administrative Law Judge:

By a petition filed in the lead proceeding on August 2,

1976, the shipper, Great Lakes Carbon Corporation, requests

a declaratory order from this Commission concerning the

rates and charges on movements of petroleum coke in

Texas, from Chaison to Steeltown, for export. By a peti-

tion filed on the same date in the embraced proceeding, the

*Embraces Docket No. 36406 (Sub-No. 1), The Kansas City

Southern Railway Company—Petition for Declaratory Order—-

Petroleum Coke.

Al0

rail carrier, The Kansas City Southern Railway Company,

requests a declaratory order concerning the rates and

charges on export movements in Texas from Port Arthur

to Steeltown of the same commodity. Both proceedings

result from an order dated June 3, 1976, by the United

States District Court for the Eastern District of Missouri

in Civil Action No. 75-808C (3) referring the matters therein

to this agency for determination of the appiicable rates and.

the justness and reasonableness thereof.

By orders dated August 11 and August 26, 1975, in the

lead and embraced proceedings, respectively, the matters

were placed under modified procedure. By order dated

September 17, 1976, the two proceedings were consolidated.

Statements and replies were duly filed by the parties; re-

quested findings not adopted herein or reflected in the

conclusions have been considered and found not justified.

Short titles may be used in this report.

In the lead proceeding, at issue are alleged overcharges

in violation of section 6 of the Interstate Commerce Act on

4,762 carloads moving from Chaison to Steeltown between

June 2, 1972, and February 26, 1973. Violation of sections

1 and 4 of the Act, and of Tariff Circular No. 20, are also

alleged. In the embraced proceeding, at issue are alleged

undercharges on movement of 621 carloads in carrier-owned

equipment from Port Arthur to Steeltown between May 6

and August 16 of 1974. In both of the proceedings, the

shipper alleges that lower freight-all-kinds-rates applied

and the carrier contends that higher specific commodity

rates on petroleum coke applied. The shipper also con-

tends that the latter, if applicable, were unjust and_unrea-

sonable.

The pertinent rail tariff provides, in section 2, non-

alternating commodity rates on petroleum coke from the

points here involved either directly, such as Chaison, or

All

through a rule applying the rate from the next point be-

yond in the case of Port Arthur. In item 216 of the tariff,

single-line rates named to Port Arthur or Beaumont, Tex.,

for export also apply to Steeltown. The tariff also con-

tains, in section 4, rates on freight all kinds, applicable to

all commodities moving in mixtures of at least two com-

modities, from and to the points here involved, directly or

by application of an intermediate point rule.

Petroleum coke is a solidified residue resulting from

the destructive distillation of crude petroleum or resi-

dual petroleum liquids. In the lead proceeding, the coke

moved from a refinery at Chaison. .During the period

involved, there was no rate published specifically for such

movements, but, as noted above, the tariff provided for

application to Steeltown of rates to Beaumont or to Port

Arthur. The higher, non-alternating rate on petroleum

coke from Chaison to Port Arthur was assessed; the shipper

maintains that it was entitled to the lower freight-all-kinds

rate named to Beaumont, under tariff item 70 making ap-

plicable that rate which results in the lower charge. Cases

are cited by the shipper to the effect that any ambiguity

should be resolved against the carrier.

In the lead proceeding, the carrier points out that item

70 of the tariffs provides for application of the lower rate

in the same rate item, not in different sections of the

tariff. Also, it is noted that both sections 2 and 4 of the

tariff state that when there are rates published in section

2 only those rates will apply to given traffic, whether the

points are specifically named or otherwise included. Fur-

ther as noted above, the rates in section 4 of the tariff

apply only to mixtures of two or more commodities.

By way of reply, in the lead proceeding, the shipper

argues that it may elect either the rate from Chaison to

Port Arthur in section 2 or the rate from Chaison to Beau-

Al2

mont in section 4 of the tariff, under item 216 of the tariff;

otherwise, that provision is allegedly in conflict with the

non-alternating provision in said section 2. Calcium Car-

bonate Co. v. U.S., 256 F. Supp. 99, 102-3, is cited for the

proposition that such conflicts are to be resolved in the

shipper’s favor. A conflict with Rule 7(b) (4), Tariff Cir-

cular No. 20, said to have the force and effect of law, is

also alleged, Calcium Carbonate Co. v. Missouri Pac. R. Co.,

329 I.C.C. 458, 462-3, being cited. The shipper maintains

that the freight-all-kinds rate applied to petroleum coke

alone, because column | rates of tariff section 4 apply to

all commodities.

In the embraced proceeding, the carrier assessed

charges on multiple-car movements from Port Arthur to

Steeltown, on the basis of rates for movements of pe-

troleum coke from West Port Arthur to Steeltown in sec-

tion 2 of the tariff, Port Arthur being an intermediate

origin. The shipper paid on the rate basis for freight all

kinds found in section 4 of the tariff, a basis which the

carrier maintains does not apply by the non-alternating

terms of both tariff sections. Court action by the carrier

is to recover the difference between the amount assessed

and the amount paid, namely $59,891.87. Several cases are

cited by the carrier to the proposition that unnamed inter-

mediate points are specific points for the application of

rates under an intermediate point rule, including Addition

of Milwaukee to Chicago Group Rates—K.C., 318 I.C.C.

755, 758.

The shippers’s position in the embraced proceeding is

that while the rates in section 2 of the tariff were admit-

tedly applicable to movements in private equipment, rates

in section 4 of the tariffs were applicable to movements

from Port Arthur to Steeltown in carrier-owned equip-

ment. Only the movements in carrier equipment are at

issue herein.

Al3-

According to the shipper, the applicable charges are

composed of a switching charge plus a rate in section 4

of t':> tariff on freight all kinds for movements from West

Po.t Arthur to Atreco, Tex., the next point beyond Steel-

town on a route allegedly available at the time the ship-

ments moved. It is argued that the higher charge from a

rate in section 2 of the tariff on shipments from West Port

Arthur to Steeltown, over the route of movement, violates

section 4 of the Act as a through rate higher than the ag-

gregate of intermediate rates over a route then available.

Numerous cases are cited to the effect that no tariff re-

striction of a rate can change its availability as an inter-

mediate factor under section 4 of the Act, and that viola-

tion thereof requires reparations. The shipper also main-

tains that the rates relied upon by the carrier were unjust

and unreasonable to the extent they exceeded those in

section 4 of the tariff, allegedly so excessive as to con-

stitute a prima facie showing of unreasonableness when

compared with other carload rates for substantially similar

movements in the same territory.

In the embraced proceeding, the carrier replies that

the non-alternating provisions of both sections 2 and 4 of

the tariffs preclude use of rates in the latter, which applied

to all classes of commodities. Numerous cases are cited to

the effect that mere violation of Tariff Circular No. 20 rules

does not invalidate the tariffs or warrant reparations The

carrier points out that an internediate point rule only ap-

plies where the point is intermediate over a feasible route;

the route referred to by the shipper was beset by opera-

tional and environmental difficulties and has since been

closed. Several cases are cited. The switching charge of

the Southern Pacific Transportation Co. allegedly cannot be

used as an intermediate factor, in which event it would

have to be paid by the shipper, since it would not be ap-

Al4

plicable in the absence of a through rate; cited is Brown-

Strauss Corp. v. Alton R.R., 219 LC.C. 69, 77.

It is the position of the carrier that the shipper’s a.-

tempt to show the section 2 rates to be unjust and unrea-

sonable through rate comparisons fails because only dis-

tances are compared. The carrier argues that a similarity

of transportation conditions must be shown; several cases,

including Clements Foods Co. of Oklahoma City v. St. Louis-

S.F. Ry., 315 LC.C. 516, 517-518, are cited.

The carrier’s evidence allegedly shows dissimilarities,

including the fact that only the rates in section 2 of the

tariff incorporate the Southern Pacific switching charge.

The lower rate from Chaison resulted from a regular high

volume of multiple-car traffic, and no petroleum coke has

moved between the origins and destinations named in sec-

tion 4 of the tariff for freight all kinds.

According to the carrier, the section 2 rate from Port

Arthur to Steeltown was based upon the rate from West

Port Arthur to Steeltown, less the amount of the reciprocal

switching charge made by the Southern Pacific and ab-

sorbed by the carrier herein; however, a review of the

tariffs reveals that a rate level was established specifically

from Port Arthur to Steeltown subsequent to the move-

ments herein. If the rate from Port Arthur is just and

reasonable, then allegedly the basic rate must be so con-

sidered, but that does not follow in a reduction.

The carrier also discusses the shipper’s claims as to

rates on shipments in privately owned cars, but the shipper

agrees that they are not before us. The carrier alleges that

the correct charges were assessed, but not paid, on the in-

volved traffic in the embraced proceeding. Both parties

assert that a determination of the issues herein would in

no way effect the quality of the human environment.

Ald.

The difficulty with the shipper’s position lies in the

fact that the lower freight-all-kinds rates in section 4 of

the tariff applied to mixtures, not shipments of single com-

modities such as petroleum coke. Also, the specific com-

modity rates in section 2 of the tariff did not alternate.

with other rates. Taken together, these provision negate

the shipper’s arguments as to applicability or violation of

section 4 of the Act, and there was no violation of Tariff

Circular 20 since only the rates in section 2 of the tariff

were applicable to the traffic at issue.

The shipper maintains, in the embraced proceeding,

that if the rates in section 2 of the tariff were applicable to

movements from Port Arthur to Steeltown, then they were

unreasonable when compared with other rates. The sec-

tion 2 rates were about $40 to $50 per car higher than the

rates on longer movements of petroleum coke from Chaison

to Steeltown or Chaison to Port Arthur. The: shipper’s

comparison with rates even lower on freight all kinds is

not meaningful because those rates applied only to mix-

tures.

According to the carrier, section 2 rates, after the issue’

period, from Port Arthur to Steeltown reflect its absorp-

tion of a reciprocal switching charge. The rate level from

Chaison to Steeltown allegedly resulted from a demon-

strated, regular, high volume of multiple-car traffic; how-

ever, while this may explain some difference in rate levels,

those rates were not limited to multiple-car movements.

The carrier does not attempt to distinguish the rate from

Chaison to Port Arthur in this regard. Also, none of these

rates were for movements exceeding 20 miles in the same

vicinity; compare Fresh Meats from Davenport, Iowa, to

Melbourne, Fla., 315 I.C.C. 621, 622. Conditions appear

similar.

Al6

In view of the above, the Judge concludes and finds

that the rates in section 2 of the rail tariff were applicable

to the movements involved in both proceedings, but that

in the embraced proceeding those rates applicable to move-

ments from Port Arthur to Steeltown, to the extent they

exceeded: the rates on petroleum come from Chaison to

Steeltown, were unjust and unreasonable. It is also found

that this is not a major Federal action significantly af-

fecting the quality of the human environment within the

meaning of the National Environmental Policy Act of 1969.

Accordingly, it is the ORDER of the Administrative

Law Judge that these proceedings be, and they are hereby,

discontinued, and that in the absence of a stay or postpone-

ment by the Commission, or the timely filing of an appeal,

the effective date of this order shall be 20 days from the

date served.

Dated in Washington, D.C., this 22nd day of March

1977.

By the Commission, Richard McG. Wilkins, Adminis-

trative Law Judge.

Robert L. Oswald

Secretary |

(Seal)

Al7

Exhibit “2”

No. 36406*

PETITION FOR DECLARATORY ORDER—GREAT

LAKES CARBON CORPORATIONW—PETROLEUM COKE

(Service Date October 7, 1977)

In an initial decision served March 31, 1977, the Ad-

ministrative Law Judge found that assailed rates and

charges on export shipments of petroleum coke in Texas

from Chaison to Steeltown were applicable, just and rea-

sonable, but that those rates found applicable: to export

movements of petroleum coke from Port Arthur to Steel-

town in the embraced proceeding were unjust and unrea-

sonable to the extent they exceeded the rates on pe-

troleum coke from Chaison to Steeltown.

On April 20, 1977, Great Lakes Carbon Corporation

(Great Lakes) filed exceptions to the initial decision. On

May 25, 1977, a petition for leave to late file a reply to the

exceptions and the reply itself were filed by Kansas City

Southern Railway Company (KCS). KCS initially sought

to file a reply on May 20, 1977, based upon time periods

in effect prior to the passage of the 4-R Act. KCS indicates

that it now understands that section 303(b) of the 4-R Act,

amending section 17 of the Interstate Commerce Act, has

beén construed to shorten the time period for filing excep-

tions (now designated as an appeal) from 30 to 20 days,

and thus make the due date for a reply statement 10 days

sooner than under former procedure. KCS indicates that

it has discussed the request made in its petition with

counsel for Great Lakes and that Great Lakes indicates it

*Embraces Docket No. 36406 (Sub-No. 1), The Kansas City

Southern Railway Company—FPetition for Declaratory Order—

Petroleum Coke.

Al8

would have no objection to granting the petition. Since

the KCS reply statement would have been timely filed

under former procedure and the effective date of the order

adopting revised procedures to conform with the 4-R Act,

Ex Parte No. 55 (Sub-No. 24), Revised Rules of Practice,

I.C.C. (1977), is July 19, 1977, KCS’s petition is granted

and its reply statement is hereinafter made part of the

record in these proceedings. ©

Embraced in the KCS reply statement is a motion to

strike portions of Great Lakes exceptions statement for

failing to state separately and number a particular con-

tention as an exception pursuant to Rule 96(a) of the Com-

mission’s General Rules of Practice... The motion to strike

is denied. In the context of the arguments made by Great

Lakes in its exceptions statement, it was unnecessary to

state separately and number this particular contention as

an exception.

The Great Lakes exceptions statement does not show

any material errors in the Administrative Law Judge’s

statement and evaluation of the facts, conclusions of law,

or findings, does not raise any matters of fact or law not

adequately considered and properly disposed of in the re-

port of the Administrative Law Judge, and does not require

issuance of a report discussing the evidence submitted and

the arguments advanced by the parties in light of the ex-

ceptions. . Therefore, having considered the entire record,

we find that the recommended decision is proper and

correct in all material respects.

1. Rule 96(a) has been replaced by Rules 97 and 98 in the

Revised Rules of Practice adopted by the Commission in Ex Parte

No. 55 (Sub-No. 24). The requirement to state and number sep-

arately is no longer a requirement in the revised rules. How-

ever, it is noted that KCS’ reply statement in which the motion

to strike is embodied was filed prior to the effective date of

the revised rules.

Alg

IT IS ORDERED:

The initial decision in these proceedings is affirmed

and adopted as our own and these proceedings are dis-

continued.

Decided October 3, 1977.

By the Commission, Division 2, Commissioners Mur-

phy, MacFarland and Clapp.

H. G. Homme, Jr.

Acting Secretary

(Seal)

TRANSCRIPT OF HEARING ON MOTIONS

St. Louis, Missouri

February 6, 1978

Transcript of proceedings had during the hearing of

the above-styled matter before the Honorable H. Kenneth

Wangelin, Judge of the District Court of the United States,

Eastern District of Missouri, Eastern Division, presiding

in Court No. 2 thereof.

APPEARANCES:

Mr. Robert K. Dreiling and

Mr. Theodore R. Schneider

114 West 11th Street

Kansas City, Missouri 64105 for the plaintiff;

Pope, Ballard & Loos

700 Brawner Building

888 17th Street, N.W.

Washington, D. C.

by Mr. Dickson R. Loos for the defendant;

A20

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No. 79-1075

The Kansas City Southern Railway Company,

Appellant,

V.

Great Lakes Carbon Corporation,

Appellee.

Appeal from the United States District Court for the

Eastern District of Missouri

Submitted: May 18, 1979

Filed: September 24, 1979

Before GIBSON, Chief Judge, HEANEY and McMILLIAN,

Circuit Judges.

McMILLIAN, Circuit Judge.

Appellant Kansas City Southern Railway Co. (KCS)

appeals from a district court order’ denying its Rule

60(b) (4) motion for relief from a judgment entered in

favor of appellee Great Lakes Carbon Corp. (GLC) on

April 25, 1978. For reversal KCS argues that the judg-

ment was void because the district court lacked subject

matter jurisdiction. KCS argues that the United States

1. Kansas City S. Ry. v. Great Lakes Carbon Corp., No. 75-

808C(3) (E.D. Mo. Dec. 21, 1978) (denial of Rule 60(b)(4) mo-

tion).

2. Kansas City S. Ry. v. Great Lakes Carbon Corp., 462 F.

Supp. 21 (E.D. Mo. 1978).

A21

was never made a party defendant as required by 28 U.S.C.

§ 2322 and that such a failure was a fatal jurisdictional de-

fect. GLC argues that the district court did have subject

matter jurisdiction, the jurisdictional issue is now res

judicata and law of the case, and that a Rule 60(b) (4) mo-

tion cannot be used as a substitute for direct appeal.

For the reasons discussed below, we reverse and

remand with directions to the district court to set aside the

judgment. .

The court is familiar with the facts of the case. See

Kansas City Southern Ry. v. Great Lakes Carbon Corp., No.

79-1075 (8th Cir. Apr. 2, 1979) (denial of motion to dis-

miss appeal). KCS filed a complaint in district court

against GLC to collect $59,891.97 (as amended) in addi-

tional freight charges alleged to be due for shipments of

petroleum coke* from a GLC plant in Port Arthur, Texas,

to an export facility in Steeltown, Texas. KCS argued that

the applicable rate on these shipments was described in

Item 4117-B, Supplement 83, TLFB Tariff 75-Series. GLC

denied liability and argued that the applicable rate was the

lower rate set forth in Item 30060-A of Section 4, TLFB

Tariff 75-Series. GLC also filed a counterclaim against

KCS to recover $129,026.47 in alleged overcharges for ship-

ments of petroleum coke from another GLC plant located

in Chaison, Texas, to Steeltown. GLC argued that KCS

had erroneously applied the higher rate described in Item

4112 of Section 2, TLFB Tariff 75-Series, when the ap-

plicable rate was the lower rate set forth in Items 30000

and 30020 of Section 4, TLFB Tariff 75-Series (from

Chaison to Beaumont, Texas) and Item 216, Supplement 15,

TLFB Tariff '75-Series and Reissues (from Chaison to Steel-

town).

3. Petroleum coke is a solidified residue resulting from the

destructive distillation of crude petroleum or residual petroleum

liquids.

A22

In June 1976, at the request of both parties, the

district court wisely entered an order staying the pro-

ceedings in district court and referring the disputed ques-

tions of tariff interpretation and application to the Inter-

state Commerce Commission (ICC).* Both parties then

filed petitions for declaratory order with the ICC

which were consolidated for handling. On March 31,

1977, the administrative law judge’ filed his decision and

recommended order finding that the higher specific com-

modity rates for petroleum coke were applicable (the posi-

tion argued by KCS), but that “‘those rates applicable to

movements from Port Arthur to Steeltown, to the extent

they exceeded the rates on petroleum coke from Chaison

to Steeltown, were unjust and unreasonable.” This de-

cision was essentially adverse to the position of GLC: KCS

would recover a reduced amount on its complaint for

undercharges ($29,898.32) but GLC would recover nothing

on its counterclaim for overcharges. Following considera-

tion of exceptions to the decision of the administrative law

judge filed by GLC, the decision was affirmed and adopted

by the ICC on October 7, 1977. There were no further

administrative proceedings before the ICC.

Thereafter, on December 6, 1977, GLC filed a motion

for summary judgment in the district court in favor of

KCS on its complaint in a reduced amount and in favor of

GLC on its counterclaim. GLC argued that the inter-

pretation of the terms “freight all kinds” and “all com-

modities” as used in the tariff was not a matter within the

4. Kansas City S. Ry. v. Great Lakes Carbon Corp., No. 75-

808C(3) (E.D. Mo. June 3, 1976) (order of referral and stay of

proceedings).

5. Hon. Richard McG. Wilkins, Administrative Law Judge,

Washington, D.C. (Interstate Commerce Commission).

A23

primary jurisdiction® of the ICC, that the interpretation

of the ICC was erroneous, and that the district court should

disregard the decision of the ICC to that extent. On Janu-

ary 26, 1978, KCS filed a motion for summary judgment

in its favor, consistent with the decision of the ICC, for re-

duced recovery for undercharges and on the counterclaim.

After oral argument the district court granted KCS’ mo-

tion for summary judgment on its complaint in the amount

of $29,898.32 plus interest and GLC’s motion for summary

judgment on its counterclaim in the amount of $129,026.47

plus interest. Kansas City Southern Ry. v. Great Lakes

Carbon Corp., supra, 462 F. Supp. at 24. Neither party ap-

pealed.

KCS later filed several post-judgment motions in dis-

trict court, including a motion for extension of time within

which to file a notice of appeal. The motions were denied.

KCS next petitioned this court for a writ of mandamus,

arguing for the first time that the district court lacked

subject matter jurisdiction to grant summary judgment in

favor of GLC on its counterclaim. We denied the petition,

characterizing it as a belated attempt to amend the final

6. The doctrine of primary jurisdiction, like the rule re-

quiring exhaustion of administrative remedies, is concerned

with promoting proper relationships between the courts and

administrative agencies charged with particular regulatory

duties. “Exhaustion” applies where a claim is cognizable

in the first instance by an administrative agency alone; judicial

interference is withheld until the administrative process has

run its course. ‘Primary jurisdiction,” on the other hand,

applies where a claim is originally cognizable in the courts,

and comes into play whenever enforcement of the claim

requires the resolution of issues which, under a regulatory

scheme, have been placed within the special competence of

an administrative body; in such a case the judicial process

is suspended pending referral of such issues to the adminis-

trative body for its views.

United States v. Western P.R.R., 352 U.S. 59, 63-64 (1956); see

generally Jaffe, Primary Jurisdiction, 77 HARV. L. REV. 1037

(1964) (criticizes court deference to agency expertise).

A24

judgment in order to file an untimely appeal.’ KCS then

filed the present Rule 60(b) (4) motion for relief from a

void judgment. The motion was denied by the district

court and this appeal followed.

Ordinarily, the denial of a Rule 60(b) motion is re-

viewed only for abuse of discretion. E.g., V.T.A., Inc. v.

AIRCO, Inc., 597 F.2d 220, 223-24 n.7 (10th Cir. 1979). Fur-

ther, “an appeal from denial of Rule 60(b) relief does not

bring up the underlying judgment for review.” Browder

v. Director, Department of Corrections, 434 U.S. 257, 263

n.7 (1978) (citations omitted). We note, however, that our

review of a Rule 60(b) (4) motion is not quite as restricted

because a motion under Rule 60(b) (4)® “differs markedly

from motions under the clauses of Rule 60(b).” 11 C.

WRIGHT & A. MILLER, FEDERAL PRACTICE AND PRO-

CEDURE § 2862, p. 197 (1973) (hereinafter cited as

WRIGHT & MILLER); see also 7 J. MOORE, FEDERAL

PRACTICE ff 60.25[1-3] (1979). This is because “[a] void

judgment is a legal nullity and a court considering a mo-

tion to vacate has no discretion in determining whether

it should be set aside.” Jordon v. Gilligan, 500 F.2d 701,

704 (6th Cir. 1974), cert. denied, 421 U.S. 991 (1975).

“(T]he only question for the court is whether the judg-

ment is void; if it is, relief from it should be granted.”

Austin v. Smith, 114 U.S. App. D.C. 97, 103, 312 F.2d 337,

343 (1962); accord, Hicklin v. Edwards, 226 F.2d 410, 414

(8th Cir. 1955); see also 11 WRIGHT & MILLER, supra,

7. Kansas City S. Ry. v. Wangelin, No. 78-1603 (8th Cir.

Sept. 8, 1978) (slip op. at 2), reported at 582 F.2d 1228 (decision

without published opinion).

8. Rule 60(b) of the Federal Rules of Civil Procedure pro-

vides in pertinent part: “On motion and upon such terms as

are just, the. court may relieve a party . from a final judg-

ment, order, or proceeding for the following reasons: . (4)

the judgment is void ....” In practice Rule 60(b) (4) motions

are not subject to any time limitation; any judgment that is

void is void from the outset. V.T.A., Inc. v. AIRCO, Inc., supra,

597 F.2d at 224 & n.9.

A25

§ 2862, p. 197 (relief is mandatory). In reviewing the

denial of a Rule 60(b) (4) motion, we thus necessarily

examine the validity of the underlying judgment. E.g.,

V.T.A., Inc. v. AIRCO, Inc., supra, 597 F.2d at 224 n.8.

This case raises several interesting procedural ques-

tions. Our analysis is somewhat complicated by the fact

that neither party was able to discern the appropriate

procedure to follow. Both parties revised their procedural

characterization of the proceedings in the district court

and before the ICC. First, we must determine whether

the district court had subject matter jurisdiction.°

The action was properly filed in the district court.

KCS sought to recover unpaid freight charges on interstate

shipments; such an action arises under an act of Congress

regulating commerce and is within the original jurisdiction

of the district court. 28 U.S.C. § 1337(a); eg., Penn

Central Co. v. General Mills, Inc., 439 F.2d 1338, 1339 (8th

Cir. 1971). As noted above, the district court determined

that the questions raised in the action were within the

primary jurisdiction of the ICC, stayed its proceedings and

referred the matter to the ICC. A referral to the ICC

merely suspends proceedings in the district court; the dis-

trict court retains exclusive jurisdiction of the matter,

pending resolution by the ICC. 28 U.S.C. §§ 1336(b),’°

9. The procedural history of the present case also raises a

further question about the nature of the relationship between

Rule 60(b)(4) and various finality of judgments doctrines, such

as res judicata and law of the case. See generally Dobbs, Beyond

Bootstrap: Foreclosing the Issue of Subject-Matter Jurisdiction

Before Final Judgment, 51 MINN. L. REV. 491 (1967); Note,

Filling the Void: Judicial Power and Jurisdictional Attacks on

Judgments, 87 YALE L.J. i164 (1977).

10. 28 U.S.C. § 1336(b) provides:

When a district court or the Court of Claims refers a ques-

tion or issue to the Interstate Commerce Commission for

determination, the court which referred the question or issue

shall have exclusive jurisdiction of a civil action to enforce,

enjoin, set aside, annul, or suspend, in whole or in part, any

order of the Interstate Commerce Commission arising out

of such referral.

A26

1398 (b) ;"" see Southern Pacific Transportation Co. v. United

States, 505 F.2d 1252, 1254-55 (Ct. Cl. 1974); Keller In-

dustries, Inc. v. United States, 449 F.2d 163, 166-67 (5th

Cir. 1971); McLean Trucking Co. v. United States, 181 Ct.

Cl. 170, 387 F.2d 657, 659-61 (1967); International Trans-

port, Inc. v. United States, 337 F. Supp. 985, 988-89 (W.D.

Mo.), aff'd on appeal sub nom. C & H Transportation Co.

v. ICC, 409 U.S. 904 (1972); Leonard Bros. Trucking Co. v.

United States, 301 F. Supp. 893, 896-97 (S.D. Fla. 1969);

Elgin, Joliet & Eastern Ry. v. Benjamin Harris & Co., 245

F. Supp. 467, 470-71 (N.D. Ill. 1965).

These sections authorizing the referring court to have

exclusive jurisdiction to review ICC orders from referrals

were the result of the 1964 amendment to 28 U.S.C. §§ 1336,

1398. Act of Aug. 30, 1964, Pub. L. No. 88-513, § 1, 78 Stat.

695 (codified at 28 U.S.C. §§ 1336(b), (c), 1398(b) ).

Prior to [the 1964 amendment] whenever the Court of

Claims or District Court referred the issue to the Inter-

state Commerce Commission for a resolution, the Com-

mission order emanating therefrom was subject to ju-

dicial review by a three-judge district court [this has

been changed to circuit court of appeals review, see

discussion infra], pursuant to 28 U.S.C. §§ 1336, 1398,

2284, 2321-25, rather than by the referring court. Con-

sequently, the referring court had to await the de-

cision of the three-judge court, the Supreme Court, if

an appeal was taken, and any other proceedings which

might result from such judicial decisions, before it

could proceed to final judgment.

11. 28 U.S.C. § 1398(b) provides:

A civil action to enforce, enjoin, set aside, annul, or suspend,

in whole or in part, an order of the Interstate Commerce

Commission made pursuant to the referral of a question or

issue by a district court or by the Court of Claims, shall be

brought only in the court which referred the question or issue.

A27

Inte, ational Transport, Inc. v. United States, supra, 337

F. Supp. at 989 (citation omitted); see also S. Rep. No.

1394, 88th Cong., 2d Sess. 2, reprinted in [1964] U.S. CODE

CONG. & AD. NEWS 3235. We note that in 1975 Congress

further amended the statutory procedure for the review of

ICC orders by eliminating three-judge district courts as ad-

ministrative review panels and transferring judicial review

to the courts of appeals. Act of Jan. 2, 1975, Pub. L. No.

93-584, §§ 4-5, 88 Stat. 1917 (codified at 28 U.S.C. §§ 2321,

2342); see Island Creek Coal Sales Co. v. ICC, 561 F.2d

1219, 1222 (6th Cir. 1977); Aluminum Co. of America v.

United States, 553 F.2d 1268, 1269-70 (D.C. Cir. 1977)

(per curiam) ; Chemical Leaman Tank Lines, Inc. v. United

States, 446 F. Supp. 721, 723-24 (D. Del. 1978) (per curiam) ;

see also H.R. Rep. No. 93-1569, 93d Cong., 1st Sess. 1,

reprinted in [1974] U.S. CODE CONG. & AD. NEWS 7025,

7025 (characterizing the then current procedure for ju-

dicial review of ICC orders as “cumbersome and outdated

judicial machinery”); Anderson, Judicial Review of De-

cisions of the Interstate Commerce Commission, 31 GEO.

WASH. L. REV. 277 (1962). However, nothing in the

new statute or in the legislative history indicated “an

intention to vest in the courts of appeals any jurisdiction

with respect to ICC orders other than the jurisdiction

previously exercised by three-judge district courts.” Island

Creek Coal Sales Co. v. ICC, supra, 561 F.2d at 1222. Thus,

actions regarding the payment of money pursuant to 28

US.C. § 1336(a),'* and actions involving referrals to the

12. U.S.C. § 1336(a) provides:

Except as otherwise provided by Act of Congress, the dis-

trict courts shall have jurisdiction of any civil action to en-

force, in whole or in part, any order of the Interrstate Com-

merce Commission, and to enjoin or suspend, in whole or in

part, any order of the Interstate Commerce Commission for

the payment of money or the collection of fines, penalties,

and forfeitures.

A28

ICC, pursuant to 28 U.S.C. § 1336(b), like the present case,

are matters within the jurisdiction of single-judge district

courts."®

However, “[s]ince the 1964 amendments made no

changes in the substantive law, except to fix venue and

jurisdiction in the referring court, the prerequisites for

judicial review remain the same.” McLean Trucking Co.

v. United States, supra, 387 F.2d at 660. One prerequisite

is the exhaustion of administrative procedures before the

ICC: a final order. Id. Another prerequisite is that a

motion for review of the final order of the ICC in a re-

ferral be filed within 90 days. 28 U.S.C. § 1336(c). Fur-

ther, although § 1336(b) does not require “the institution .

of a formal new ‘civil action’ by the party seeking review,

[that party must] file ‘a pleading setting forth the action

he requests of [the district] court and stating specifically

the grounds therefor.’” Southern Pacific Transportation

Co. v. United States, supra, 505 F.2d at 1254, citing McLean

Trucking Co. v. United States, supra, 387 F.2d at 660.

GLC complied with these requirements by filing a motion

for summary judgment (with memorandum in support)

on December 6, 1977, within 90 days of the final order of

the ICC issued October 7, 1977. Unfortunately, neither

13. Unlike other ICC orders, payment orders are not “quasi

legislative orders, in which the public at large are interested

.” Rather, they “affect only the rights of private in-

dividuals, have no binding force and do not subject anyone

to punishment for disobedience.” Such orders “are not of

sufficient public importance to justify the accelerated judicial

review procedure.”

Aluminum Co. of America v. United States, supra, 553 F.2d at

1270 (citations omitted).

Direct judicial review in referral cases was vested exclu-

sively in the referring district court to provide a more stream-

lined procedure. McLean Trucking Co. v. United States, supra,

387 F.2d at 659.

A29

ws party made the United States or the ICC’ a party defen-

dant. The absence of the United States as a party in an

action for judicial review of an ICC order is a fatal jurisdic-

tional defect. 28 U.S.C. § 2322; e.g., Schwartz v. Bowman,

244 F. Supp. 51, 68 (S.D.N.Y. 1965), aff'd sub nom. Annen-

berg v. Alleghany Corp., 360 F.2d 211 (2d Cir.) (per cu-

riam), cert. denied sub nom. Schwartz v. Eaton, 385 U.S.

921 (1966). There is no reason why this requirement should

not apply to the present case.

Congress established an exclusive method for judicial

review and enforcement of ICC orders in the Urgent

Deficiencies Act of 1913, 28 U.S.C. §§ 1336, 2321-23 (as

amended). £.g., B.F. Goodrich Co. v. Northwest Industries,

Inc., 424 F.2d 1349, 1353 (3d Cir.), cert. denied, 400 U.S.

822 (1970); Schwartz v. Bowman, supra, 244 F. Supp. at

66-69. The statutory pattern was changed by the 1964

and 1975 amendments as discussed earlier. ICC orders,

except those for the payment of money or which are the

result of a referral from a district court, are now reviewed

by the circuit courts of appeals under the provisions of

the Judicial Review Act of 1950 (Hobbs Act), 28 U.S.C.

§§ 2341 et seq., with discretionary review by writ of cer-

tiorari in the Supreme Court, 28 U.S.C. § 1254. Venue

provisions were also changed and a 60-day period for filing

petitions for review in the courts of appeals was added.

See generally H.R. Rep. No. 93-1569, 93d Cong., 1st Sess. 1,

reprinted in [1974] U.S. CODE CONG. & AD. NEWS 7025,

14. In McLean Trucking, which was “the first case brought

under the new statutory pattern [referring to the 1964 amend-

ments],” the Court of Claims characterized the ICC as “a neces-

sary party whenever its decision on a referred case is attacked.”

387 F.2d at 660. This characterization recognized that the gen-

eral practice before the 1964 amendments was that such actions

were ordinarily filed against the United States and the ICC. Id.

In our opinion the ICC should be made a party in cases like the

present one. However, the more serious, and dispositive, omis-

sion was the failure to join the United States as a party defen-

dant. See discussion in text infra.

A30

7034-36 (report of Department of Justice). As noted

earlier, the 1964 amendments provided that appeals from

ICC orders in judicial reference cases were heard by the

referring court. These amendments did not, however,

change the requirement that the United States be made

a party defendant.

We note that 28 U.S.C. § 2321(b) expressly provides:

“The procedure in the district courts in actions to enforce,

in whole or in part, any order of the Interstate Commerce

Commission other than for the payment of money or the

collection of fines, penalties, and forfeitures, shall be as

provided in this chapter.” Section 2322 further provides:

“All actions specified in section 2321 of this title shall be

brought by or against the United States.” Case law es-

tablishes that the requirements of the Urgent Deficiencies

Act are not mere matters of procedure, North Dakota ex

rel. Lemke v. Chicago & Northwestern Ry., 257 U.S. 485,

490 (1922), and that compliance is strictly enforced for

public policy reasons. E.g., Ayrshire Collieries Corp. v.

United States, 331 U.S. 132 (1947). Although it is true

that the earlier case law focused upon the difficulties in-

herent in three-judge district court review, id. at 144 (par-

ticipation of less than three judges held to render decision

void), the policy reasons for making the United States a

party remain valid: to insure that the public interest, as

well as the interests of all interested parties, see 28 U.S.C.

§ 2323, in this important and specialized area would be

protected. That this requirement continues to be applicable

was explicitly recognized in the legislative history to the

1975 amendments:

In all other material respects, the existing pro-

cedure will continue under the new statute. Thus,

actions will be filed against the United States, with the

Attorney General managing and controlling the de-

A3l

fense of the agency’s order. This is in line with

existing procedure applicable to the ICC and to agen-

cies already governed by the Judicial Review Act....

H.R. Rep. No. 93-1569, 93d Cong., lst Sess., reprinted in

[1974] U.S. CODE CONG. & AD. NEWS 7025, 7036 (em-

phasis added). Therefore, the United States is an indis-

pensable party to an action for review of an ICC order

in a referral case. Elgin, Joliet & Eastern Ry. v. Benjamin

Harris & Co., supra, 245 F. Supp. at 470; cf. Southern Pa-

cific Transportation Co. v. United States, supra, 505 F.2d

at 1254 (Court of Claims case in which the United States

was already a party); Keller Industries, Inc. v. United

States, supra, 449 F.2d at 165 (referral case in which the

United States was made a party; discussion of whether

three-judge or single judge district court was required);

Schwartz v. Bowman, supra, 244 F. Supp. at 68-69 (dis-

cussion of requirements of Urgent Deficiencies Act). We

reverse the denial of the Rule 60(b) (4) motion and re-

mand to the district court with directions to set aside the

judgment entered on April 25, 1978, as void for lack of

subject matter jurisdiction. The parties may seek judicial

review of the ICC order by amending the pleadings in the

action now pending in the district court to include the

United States as a party defendant. In addition, we sug-

gest that the better practice would be to make the ICC a

party to the review proceedings as well. See note 14, supra.

Further, we note that to the extent relief under the

Rule 60(b) (4) motion has enabled KCS to evade the doc-

trine of the finality of judgments” and to in effect “appeal’”’

15. See Durfee v. Duke, 375 U.S. 106, 113 (1963), citing

Treinies v. Sunshine Mining Co., 308 U.S. 66, 78 (1939); Chicot

County Drainage Dist v. Baxter State Bank, 308 U.S. 371 (1940);

Stoll v. Gottlieb, 305 U.S. 165 (1938).

Moreover, res judicata is not applicable in the present case.

As observed by Professor Dobbs,

(Continued on following page)

A32

indirectly from a final judgment, it would seem that this is

the intended function of Rule 60(b) (4). “This subdivision

[of Rule 60(b)] provides relief from final judgment if

the judgment is void.” V.T.A., Inc. v. AIRCO, Inc., supra,

597 F.2d at 224. It is apparent from the record in the

present case that the district court lacked subject matter

jurisdiction: the United States is not a party to the pro-

ceeding. It makes little difference that this jurisdictional

question was raised for the first time under Rule 60(b) (4):

Questions of jurisdiction, of course, can be raised at

any time. And, as the Supreme Court said in Lam-

bert Run in a private action in which indirect attack

was made on ICC orders.—“Jurisdiction cannot be ef-

fectively acquired by concealing for a time the facts

which conclusively establish that it does not exist.”

Schwartz v. Bowman, supra, 244 F. Supp. at 69 (direct

review), citing Lambert Run Coal Co. v. Baltimore & Ohio

R.R., 258 U.S. 377, 382 (1922) (necessity of strict com-

pliance with procedural requirements of Urgent Deficiencies

Act).

GLC also argues that the order of the ICC was merely

an advisory opinion. GLC argues that the action was not

referred to the ICC and that KCS did not consider that

“Stay one of referral to the Interstate Commerce Commis-

Footnote continued—

res judicata comes into play only when there is a final judg-

ment and a collateral attack—that is, when there is a second

and distinct suit. Since a motion under Rule 60(b) is a

motion in the original suit and is thus a direct attack, there

is no res judicata involved and the issue of jurisdiction can-

not be foreclosed by that doctrine.

Dobbs, Beyond Bootstrap, supra note 9, 51 MINN. L. REV. at 496.

Dobbs argues that the “bootstrap principle” should foreclose ex-

amination of jurisdictional issues, even under Rule 60(b) 4);

after appeal. Id. See generally Dobbs, The Validation of Void

Judgments: The Bootstrap Principle, Part II - The Scope of

Bootstrap, 53 VA. L. REV. 1241 (1967).

A33

sion.” Brief of Appellee, at 16, citing Brief of Appellant,

at 12. GLC characterizes the district court order of June

3, 1976, as “a direction to the parties to file Petitions with

the Commission to ascertain its view as to such of the

subject matter as would be within its primary jurisdic-

tion.” Brief of Appellee, at 16. That neither party fully

understood the nature of the procedure is beside the point.

The district court considered its order (see Appendix A)

to be a referral, Kansas City Southern Ry. v. Great Lakes

Carbon Corp., supra, 462 F. Supp. at 22, and we agree with

that view. A referral to the ICC is the only characteriza-

tion consistent with the statutory pattern discussed above.

See 28 U.S.C. §§ 1336(a) (b), 1898(b), 2321(b). The fact

that the matter came before the ICC pursuant to a referral

from the district court under 28 U.S.C. § 1336(b) did not

transform the resulting order into an advisory opinion.

The ICC order in the present case was not a mere abstract

declaration but determined the rights of the parties to

recover, the applicability of the tariffs and the reasonable-

ness of the rates at issue. Pennsylvania R.R. v. United

States, 363 U.S. 202, 205 (1960), citing Rochester Telephone

Corp. v. United States, 307 U.S. 125, 131-32, 143 (1939), and

El Dorado Oil Works v. United States, 328 U.S. 12, 18

(1946).

Finally, we address briefly the question of primary

jurisdiction. In our opinion the question of the applicability

of tariffs to particular commodities is within the primary

jurisdiction of the ICC. See Elgin, Joliet & Eastern Ry. v.

Benjamin Harris & Co., supra, 245 F. Supp. at 471. We

find the thorough opinion of Judge Ross in Penn Central

Co. v. General Mills, Inc., supra, 439 F.2d at 1340-42, and

the cases cited therein to be distinguishable. The question

at issue in the present case involves the interpretation of

a tariff and terms used in a technical way. We note that

the decision of the administrative law judge in part rested

Att,

A34

upon the interpretation of the terms “freight all kinds”

and “all commodities” but also in part upon the non-alter-

nating nature of the specific commodity rates. See Ap-

pendix B. The ICC is obviously more familiar with the

interaction and construction of tariffs than the court. In

short, we think the question presented falls within the

principles established in United States v. Western Pacific

R.R.: the construction and applicability of the tariff at issue

raised “issues of transportation policy which ought to be

considered by the Commission in the interests of a uniform

and expert administration of the regulatory scheme laid

down by the Act.” 352 U.S. at 65. We note further that

once the primary jurisdiction of the ICC has been invoked

on a particular question, the scope of judicial review is

limited: “Unless the findings of the Commission are con-

trary to law, arbitrary, capricious or unsupported by sub-

stantial evidence, they may not be set aside... . [T]he

judicial function is exhausted when there is found to be a

rational basis for the Commission’s conclusions.” McLean

Trucking Co. v. United States, supra, 387 F.2d at 661, citing

General Motors Corp. v. United States, 324 F.2d 604, 605

(6th Cir. 1963), and Mississippi Valley Barge Line Co. v.

United States, 292 U.S. 282, 286-87 (1934).

Accordingly, the order of the district court denying

appellant’s Rule 60(b) (4) motion is reversed and remanded

with directions.

A true copy. ea

ATTEST:

CLERK, U.S. COURT OF APPEALS, EIGHTH

CIRCUIT

A35

APPENDIX A

ORDER OF REFERRAL AND STAY

OF PROCEEDINGS

(Filed June 3, 1976)

Now on this 3 day of June, 1976, Joint Motion of

plaintiff and defendant to refer to the controversy to the

Interstate Commerce Commission for a determination of the

applicability and justness and reasonableness of certain

rates and regulation and to hold matter in abeyance pend-

ing the determination by the Interstate Commerce Com-

mission having come on for hearing before this Court, the

Court finds as follows:

1, That this lawsuit involves an action for alleged

undercharges by the plaintiff and a counterclaim for al-

leged overcharges by the defendant.

2. That determination of these controversies involve

the interpretation and application and the justness and rea-

sonableness of certain tariffs filed with the Interstate Com-

merce Commission. Primary jurisdiction for the deter-

mination of the interpretation and application and justness

and reasonableness of such tariffs of interstate rail car-

riers is vested by federal law in the Interstate Commerce

Commission.

3. The Interstate Commerce Commission is a spe-

cialized, primary and appropriate forum for the adjudica-

tion of these controversies and its determination will likely

be decisive of all claims herein and will be binding and

legally effective upon all parties hereto.

4. That all parties to this proceeding have agreed that

the matter should be referred to the Interstate Commerce

Commission for interpretation.

A36

NOW, THEREFORE, inasmuch as this lawsuit involves

a matter of the interpretation of particular tariff items,

and the justness and reasonableness of such tariff items,

that questions of tariff interpretation and justness and

reasonableness of tariffs are within the primary jurisdiction

of the Interstate Commerce Commission; and that all par-

ties are agreed that this matter should be referred to the

Interstate Commerce Commission for disposition.

IT IS HEREBY ORDERED AND DECREED that this

matter be, and the same is hereby, referred to the Inter-

state Commerce Commission for resolution and that pend-

ing such resolution the instant proceeding will be held in

abeyance. The parties are directed within 60 days of the

date of this order to file petitions with the Interstate Com-

merce Commission for declaratory orders to bring these

matters before that agency for prompt determination.

Parties are further directed to give notice to this Court of

the filing of the petition with the Interstate Commerce

Commission.

/s/ H. Kenneth Wangelin

Judge

Dated this 3 day of June, 1976.

A37

APPENDIX B

INTERSTATE COMMERCE COMMISSION

INITIAL DECISION

No. 36406*

PETITION FOR DECLARATORY ORDER—

GREAT LAKES CARBON CORPORATION—

PETROLEUM COKE

(Service Date March 31, 1977)

1. Assailed rates and charges on shipments of petroleum

coke in Texas from Chaison to Steeltown for export

found to have been applicable, just and reasonable.

2, Sought rates and charges on export shipments of

petroleum coke in Texas from Port Arthur to Steel-

town found to have been applicable but not just and:

reasonable, to the extent they exceeded those in

No. 1, above.

3. Proceedings discontinued.

Dickson R. Loos and Barry Roberts for the shipper, Great

Lakes Carbon Corporation.

Robert K. Dreiling and Robert E. Zimmerman for the ‘ail

carrier, The Kansas City Southern Railway Company.

By Richard McG. Wilkins, Administrative Law Judge:

By a petition filed in the lead proceeding on August 2,

1976, the shipper, Great Lakes Carbon Corporation, re-

quests a declaratory order from this Commission concern-

ing the rates and charges on movements of petroleum coke

in Texas, from Chaison to Steeltown, for export. By a

“Embraces Docket No. 36406 (Sub-No. 1), The Kansas City

Southern Railway Company—Petition for Declaratory Order—

Petroleum Coke.

A38

petition filed on the same date in the embraced proceeding,

the rail carrier, The Kansas City Southern Railway Com-

pany, requests a declaratory order concerning the rates

and charges on export movements in Texas from Port

Arthur to Steeltown of the same commodity. Both pro-

ceedings result from an order dated June 3, 1976, by the

United States District Court for the Eastern District of

Missouri in Civil Action No. 75-808C (3) referring the mat-

ters therein to this agency for determination of the ap-

plicable rates and the justness and reasonableness thereof.

By orders dated August 11 and August 26, 1976, in

the lead and embraced proceedings, respectively, the mat-

ters were placed under modified procedure. By order

dated September 17, 1976, the two proceedings were con-

solidated. Statements and replies were duly filed by

the parties; requested findings not adopted herein or re-

flected in the conclusions have been considered and found

not justified. Short titles may be used in this report.

In the lead proceeding, at issue are alleged overcharges

in violation of section 6 of the Interstate Commerce Act

on 4,762 carloads moving from Chaison to Steeltown be-

tween June 2, 1972, and February 26, 1973. Violation of

sections 1 and 4 of the Act, and of Tariff Circular No. 20, are

also alleged. In the embraced proceeding, at issue are

alleged undercharges on movement of 621 carloads in car-

rier-owned equipment from Port Arthur to Steeltown be-

tween May 6 and August 16 of 1974. In both of the pro-

ceedings, the shipper alleges that lower freight-all-kinds-

rates applied and the carrier contends that higher specific

commodity rates.en petroleum coke applied. The shipper

also contends that the latter, if applicable, were unjust

and unreasonable.

The pertinent rail tariff provides, in section 2, non-

alternating commodity rates on petroleum coke from the

A39

points here involved either directly, such as Chaison, or

through a rule applying the rate from the next point be-

yond in the case of Port Arthur. In item 216 of the

tariff, single-line rates named to Port Arthur or Beaumont,

Tex., for export also apply to Steeltown. The tariff also

contains, in section 4, rates on freight all kinds, applicable

to all commodities moving in mixtures of at least two com-

modities, from and to the points here involved, directly

or by application of an intermediate point rule.

Petroleum coke is a solidified residue resulting from

the destructive distillation of crude petroleum or residual

petroleum liquids. In the lead proceeding, the coke moved

from a refinery at Chaison. During the period involved,

there was no rate published specifically for such move-

ments, but, as noted above, the tariff provided for applica-

tion to Steeltown of rates to Beaumont or to Port Arthur.

The higher, non-alternating rate on petroleum coke from

Chaison to Port Arthur was assessed; the shipper maintains

that it was entitled to the lower freight-all-kinds rate named

to Beaumont, under tariff item 70 making applicable that

rate which results in the lower charge. Cases are cited

by the shipper to the effect that any ambiguity should be

resolved against the carrier.

In the lead proceeding, the carrier points out that item

70 of the tariffs provides for application of the lower rate

in the same rate item, not in different sections of the tariff.

Also, it is noted that both sections 2 and 4 of the tariff

state that when there are rates published in section 2 only

those rates will apply to given traffic, whether the points

are specifically named or otherwise included. Further as

noted above, the rates in section 4 of the tariff apply only

to mixtures of two or more commodities.

In the embraced proceeding, the carrier assessed

charges on multiple-car movements from Port Arthur to

A40

Steeltown, on the basis of rates for movements of petrol-

eum coke from West Port Arthur to Steeltown in section 2

of the tariff, Port Arthur being an intermediate origin.

The shipper paid on the rate basis for freight all kinds

found in section 4 of the tariff, a basis which the carrier

maintains does not apply by the non-alternating terms of

both tariff sections. Court action by the carrier is to

recover the difference between the amount assessed and

the amount paid, namely $59,891.87. Several cases are cited

by the carrier to the proposition that unnamed intermediate

points are specific points for the application of rates under

an intermediate point rule, including Addition of Milwaukee

to Chicago Group Rates—K.C., 318 I.C.C. 755, 758.

The shipper’s position in the embraced proceeding is

that while the rates in section 2 of the tariff were admit-

tedly applicable to movements in private equipment, rates

in section 4 of the tariffs were applicgble to movements

from Port Arthur to Steeltown in carrier-owned equip-

ment. Only the movements in carrier equipment are at

issue herein.

According to the shipper, the applicable charges are

composed of a switching charge plus a rate in section 4

of the tariff on freight all kinds for movements from

West Port Arthur to Atreco, Tex., the next point beyond

Steeltown on a route allegedly available at the time the

shipments moved. It is argued that the higher charge

from a rate in section 2 of the tariff on shipments from

West Port Arthur to Steeltown, over the route of move-

ment, violates section 4 of the Act as a through rate higher

than the aggregate of intermediate rates over a route then

available. Numerous cases are cited to the effect that no

tariff restriction of a rate can change its availability as an

intermediate factor under section 4 of the Act, and that

violation thereof requires reparations. The shipper also

maintains that the rates relied upon by the carrier were

A4l

unjust and unreasonable to the extent they exceeded

those in section 4 of the tariff, allegedly so excessive as

to constitute a prima facie showing of unreasonableness

when: compared with other carload rates for substantially

similar movements in the same territory.

In the embraced proceeding, the carrier replies that

the non-alternating provisions of both sections 2 and 4

of the tariffs preclude use of rates in the latter, which

applied to all classes of commodities. Numerous cases are

cited to the effect that mere violation of Tariff Circular

No. 20 rules does not invalidate the tariffs or warrant

reparations. The carrier points out that an intermediate

point rule only applies where the point is intermediate

over a feasible route; the route referred to by the shipper

was beset by operational and environmental difficulties

and has since been closed. Several cases are cited. The

switching charge of the Southern Pacific Transportation

Co. allegedly cannot be used as an intermediate factor, in

which event it would have to be paid by the shipper, since

it would not be applicable in the absence of a through rate;

cited is Brown-Strauss Corp. v. Alton R.R., 219 I.C.C. 69, 77.

It is the position of the carrier that the shipper’s at-

tempt to show the section 2 rates to be unjust and unrea-

sonable through rate comparisons fails because only dis-

tances are compared. The carrier argues that a similarity

of transportation conditions must be shown; several cases,

including Clements Foods Co. of Oklahoma City v. St.

Louis-S.F. Ry., 315 LC.C. 516, 517-518, are cited.

The carrier’s evidence allegedly shows dissimilarities,

including the fact that only the rates in section 2 of the

tariff incorporate the Southern Pacific switching charge.

The lower rate from Chaison resulted from a regular high

volume of multiple-car traffic, and no petroleum coke has

moved between the origins and destinations named in

section 4 of the tariff for freight all kinds.

A42

According to the carrier, the section 2 rate from Port

Arthur to Steeltown was based upon the rate from West

Port Arthur to Steeltown, less the amount of the reciprocal

switching charge made by the Southern Pacific and ab-

sorbed by the carrier herein; however, a review of the

tariffs reveals that a rate level was established specifically

from Port Arthur to Steeltown subsequent to the move-

ments herein. If the rate from Port Arthur is just and

reasonable, then allegedly the basic rate must be so con-

sidered, but that does not follow in a reduction.

The carrier also discusses the shipper’s claims as to

rates on shipments in privately owned cars, but the shipper

agrees that they are not before us. The carrier alleges that

the correct charges were assessed, but not paid, on the

involved traffic in the embraced proceeding. Both parties

assert that a determination of the issues herein would in

no way affect the quality of the human environment.

The difficulty with the shipper’s position lies in the

fact that the lower freight-all-kinds rates in section 4 of

the tariff applied to mixtures, not shipments of single

commodities such as petroleum coke. Also, the specific

commodity rates in section 2 of the tariff did not alternate

with other rates. Taken together, these provisions negate

the shipper’s arguments as to applicability or violation

of section 4 of the Act, and there was no violation of Tariff

Circular 20 since only the rates in section 2 of the tariff

were applicable to the traffic at issue.

The shipper maintains, in the embraced proceeding,

that if the rates in section 2 of the tariff were applicable

to movements from Port Arthur to Steeltown, then they

were unreasonable when compared with other rates. The

section 2 rates were about $40 to $50 per car higher than

the rates on longer movements of petroleum coke from

Chaison to Steeltown or Chaison to Port Arthur. The

A43

shipper’s comparison with rates even lower on freight all

kinds is not meaningful because those rates applied only to

mixtures.

According to the carrier, section 2 rates, after the issue

period, from Port Arthur to Steeltown reflect its absorption

of a reciprocal switching charge. The rate level from

Chaison to Steeltown allegedly resulted from a demon-

strated, regular, high volume of multiple-car traffic;

however, while this may explain some difference in rate

levels, those rates were not limited to multiple-car move-

ments. The carrier does not attempt to distinguish the rate

from Chaison to Port Arthur in this regard. Also, none

of these rates were for movements exceeding 20 miles in

the same vicinity; compare Fresh Meats from Davenport,

Iowa, to Melbourne, Fla., 31& .C.C. 621, 622. Conditions

appear similar.

In view of the above, the Judge concludes and finds

that the rates in section 2 of the rail tariff were applicable

to the movements involved in both proceedings, but that

in the embraced proceeding those rates applicable to move-

ments from Port Arthur to Steeltown, to the extent they

exceeded the rates on petroleum coke from Chaison to

Steeltown, were unjust and unreasonable. It is also found

that this is not a major Federal action significantly affect-

ing the quality of the human evnironment within the

meaning of the National Environmental Policy Act of 1969.

Accordingly, it is the ORDER of the Administrative

Law Judge that these proceedings be, and they are hereby,

discontinued, and that in the absence of a stay or post-

ponement by the Commission, or the timely filing of an

appeal, the effective date of this order shall be 20 days

from the date served.

A44

Dated in Washington, D.C., this 22nd day of March,

1977.

By the Commission, Richard McG. Wilkins, Adminis-

trative Law Judge.

Robert L. Oswald

Secretary

(Seal)

A45

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No. 79-1075

Kansas City Southern Railway Company,

Appellant,

Vv.

Great Lakes Carbon Corporation,

Appellee.

Appeal from the United States District Court for the

Eastern District of Missouri.

Submitted: January 16, 1980

Filed: June 16, 1980

Before LAY, Chief Judge, HEANEY, BRIGHT, ROSS,

STEPHENSON, HENLEY and McMILLIAN, Circuit

Judges, En banc.

LAY, Chief Judge.

In an earlier decision this court overturned the dis-

trict court’s denial of Kansas City Southern Railway Com-

pany’s (Railway Co.), motion to set aside a judgment un-

der Rule 60(b) (4) of the Federal Rules of Civil Procedure.

Kansas City Southern Railway v. Great Lakes Carbon

Corp., 595 F.2d 431 (8th Cir. 1979). A motion for rehear-

ing was granted, and this decision follows argument to

the court en banc.

The Railway Co. originally sued Great Lakes Carbon

Corporation (GLC), for additional freight charges, claim-

A46

ing it had undercharged GLC because a higher, specific

commodity rate should apply to petroleum coke the GLC

shipped. GLC urged a lower freight-all-kinds rate ap-

plied. It also counterclaimed for overcharges on another

shipment. On the parties’ joint motion, the district court

referred interpretation of tariff items and their reasonable-

ness to the Interstate Commerce Commission (ICC), and

held the lawsuit in abeyance. The ICC affirmed an admin-

istrative law judge’s decision that generally sustained the

Railway Co.’s tariff interpretation. However, it held it

would be unjust and unreasonable for the Railway Co.

to collect the full tariff for the shipment upon which its

complaint was based. Under the ICC decision, the Railway

Co. would have recovered a reduced amount and GLC

would not have recovered anything on its counterclaim.

Each party then filed for summary judgment in the district

court. The court entered judgment for the Railway Co.

on its complaint for $29,898.32 plus interest, in accord

with the ICC decision. However, the court held it was not

bound by the ICC decision, and therefore granted GLC’s

motion for summary judgment on its counterclaim, entering

judgment on its behalf for $129,026.47 plus interest.

The Railway Co. did not appeal within 30 days as re-

quired by Rule 4(a) of the Federarl Rules of Appellate

Procedure. After its motion for an extension of time

was denied, it attempted to resurrect a judgment for

appeal by petitioning this court for a writ of mandamus

that would order the district court to rule on its motion for

summary judgment, We dismissed the petition, stating that

the Railway Co.’s motion for summary judgment as to

GLC’s counterclaim had been ruled upon and we viewed

the petition as an attempt to file an untimely appeal.

Kansas City Southern Railway v. Wangelin, 582 F.2d 1288

(8th Cir. 1978) (mem.). |

A47

The Railway Co. then filed a motion in district court,

asserting that under Rule 60(b)(4) of the Federal Rules

of Civil Procedure the judgment should be set aside as void.

It argued the district court lacked subject matter juris-

diction because it did not follow the procedure set forth

in chapter 157 of title 28, sections 2321-23, for review of

an ICC order, namely joinder of the United States as a

defendant. 28 U.S.C. § 2322. The district court denied re-

lief, stating it had considered the basic issues raised in its

earlier opinion, from which no apepal had been taken.

The Railway Co. appealed, and a panel of this court re-

versed the district court, holding inter alia, that the orig-

inal judgment was void and could be set aside under Rule

60(b)(4). The court acting en bane now vacates that

decision and enters judgment affirming the district court.

In this appeal we assume, without deciding, that under

the jurisdictional facts presented the United States was

required to be joined as a party defendant pursuant to 28

U.S.C. § 2322 once GLC sought review of the ICC decision

by motion for summary judgment. The fundamental ques-

tion presented here is whether Rule 60(b) (4)? may serve

as the procedural vehicle to attack the judgment on the

ground that it is a nullity because of the absence of the

United States.

In Schwartz v. Bowman, 244 F. Supp. 51, 65-69 (S.D.

N.Y. 1965), aff'd sub nom Annenberg v. Alleghany Corp.,

360 F.2d 211 (2d Cir.) (per curiam), cert. denied, 385 U.S.

921 (1966), the court held an ICC order could not be

attacked indirectly under the Investment Company Act of

1. Fed.R.Civ.P. 60(b)(4) reads as follows:

(b) Mistakes; Inadvertence; Excusable Neglect; Newly

Discovered Evidence; Fraud, etc. On motion and upon such

terms as are just, the court may relieve a party or his legal

representative from a final judgment, order, or proceeding

for the following reasons: ... (4) the judgment is void;

A48

1940, 15 U.S.C. § 80a; it held chapter 157 of title 28, the

Urgent Deficiencies Act, is the exclusive method for en-

forcement or review of ICC orders. As the claim had not

been brought under the Urgent Deficiencies Act and none

of its procedural requirements had been met, including

joinder of the United States, the court held it lacked

jurisdiction. This holding only serves to obscure the ques-

tion presented in this appeal.?, Assuming the district court

erred here in finding jurisdiction despite the absence of

the United States,* the question upon which relief hinges

2. The court did not hold that the United States was an

indispensable party, nor that its absence alone deprived the court

of jurisdiction.

Even if the United States is deemed an indispensable party,

its absence may not be a jurisdictional defect. Some cases have

used language indicating dismissal for nonjoinder of an indis-

pensable party is dismissal for lack of jurisdiction. See, e.g.,

Agrashell, Inc. v. Hammons Prods. Co., 352 F.2d 443, 447 (8th

Cir, 1965). The weight of authority is against this characteriza-

tion. See, e.g., Mallow v. Hinde, 25 U.S. (12 Wheat.) 193, 196

(1827); Clarkson Co. v. | naheen, 544 F.2d 624, 628 (2d Cir. 1976);

Tryforos v. Icarian Dev. Co., 518 F.2d 1258, 1265 n.26 (7th Cir.

1975), cert. denied, 423 U.S. 1091 (1976); Moore v. Knowles, 482

F.2d 1069, 1075 (5th Cir. 1973); Warner v. First Nat. Bank, 236

F.2d 853, 857 (8th Cir.), cert. denied, 352 U.S. 927 (1956); Dyer

v. Stauffer, 19 F.2d 922 (6th Cir.), cert. denied, 275 U.S. 551

(1927); Agrashell Inc. v. Composition Materials Co., 40 F.R.D.

395, 397 (S.D.N.Y. 1966); 7 C. Wright & A. Miller, Federal Prac-

tice and Procedure § 1611 at 115-17, 121 (1972); 3A Moore’s

Federal Practice | 19.04[2] & {1 19.19 at 345 (2d ed. 1979). These

authorities rely upon the history of the indispensable party doc-

trine in equity and the emphasis on equitable considerations in

Fed. R. Civ. P. 19. This reasoning may be less persuasive when

the joinder of party requirement is imposed by a statutory grant

of jurisdiction. See Noland v. United States Civil Service Comm’n,

544 F.2d 333, 334 (8th Cir. 1976).

3. In granting relief, the district court not only had to im-

plicitly decide whether the United States was a necessary or in-

dispensable party under 28 U.S.C. §§ 2321-23, but also whether

the ICC order was in effect one for payment of money, which

would be statutorily exempted from the requirement of joinder

of the United States, 28 U.S.C. § 2321(b), and whether joinder

was not necessary because the ICC order was advisory only.

. We note that the statutory exemption from 28 U.S.C. §§ 2321-

23 procedures, section 2321(b), does not encompass GLC’s mo-

tion for summary judgment on its counterclaim. GLC sought to

avoid the effect of the ICC order, and section 2321(b) applies

only to actions brought in district court to enforce an ICC pay-

ment order.

A49

is whether that error, never presented on appeal from

the judgment, may nevertheless be corrected in a Rule

60(b) (4) proceeding on the ground that it renders the

judgment void. We conclude that the judgment is not void

within the meaning of Rule 60(b) (4), and any jurisdic-

tional defect caused by nonjoinder may not now be chal-

lenged.*

Absence of subject matter jurisdiction may, in certain

cases, render a judgment void. See e.g., Kalb v. Feuerstein,

308 U.S. 433 (1940). However, this occurs only where

there is a plain usurpation of power, when a court wrong-

fully extends its jurisdiction beyond the scope of its au-

thority. Stoll v. Gottlieb, 305 U.S. 165, 171 (1938); see

Coalition of Black Leadership v. Cianci, 570 F.2d 12, 15

(1st Cir. 1978) (quoting Lubben v. Selective Service Sys-

tem, 453 F.2d 645, 649 (1st Cir. 1972)); Ben Sager Chemi-

cals v. E. Targosz & Co., 560 F.2d 805, 812 (7th Cir. 1977);

7 Moore’s Federal Practice {| 60.25[2] av 302-3 (2d ed. 1979).

Stated another way, such plain usurpation of power occurs

when there is a “total want of jurisdiction” as distinguished

from “an error in the exercise of jurisdiction.” Lubben v.

Selective Service System, 453 F.2d at 649. Since federal

courts have “jurisdiction to determine jurisdiction,” that

is, “power to interpret the language of the jurisdictional

instrument and its application to an issue by the court,”

Stoll v. Gottlieb, 305 U.S. at 171, error in interpreting a

statutory grant of jurisdiction is not equivalent to acting

with total want of jurisdiction. Such an erroneous inter-.

pretation does not render the judgment a complete nullity.

See Chicot County Drainage District v. Baxter State Bank,

4. It is basic that Fed.R.Civ.P. 60(b) is not a substitute for

appeal. Horace v. St. Louis S.W. R.R., 489 F.2d 632, 633 (8th

Cir. 1974). If a judgment is not void, but rather rests upon an

erroneous jurisdictional determination, Rule 60(b) (4) is not prop-

erly invoked to extend time for appeal that has already expired.

See id.; Hoffman v. Celebrezze, 405 F.2d 833, 837 (8th Cir. 1969).

A350

308 U.S. 371, 376-77 (1940); 7 Moore’s, supra {| 60.25[2], at

296-97. A void judgment, as opposed to an erroneous one,

is one which from its inception was legally ineffective.

See Williams v. North Carolina, 325 U.S. 226 (1945); Jordon

v. Gilligan, 500 F.2d 701, 710 (6th Cir. 1974), cert. denied,

421 U.S. 991 (1975); Lubben v. Selective Service System,

453 F.2d at 649; 7 Moore’s, supra {| 60.25[2].°

In the present case, even assuming the district court

erred in construing its statutory grant of authority by not

joining the United States, we hold such jurisdictional error

does not render the judgment void within the meaning of

Rule 60(b) (4).

We reach this conclusion because the court was vested

with power to deal with this type of case and had ac-

quired jurisdiction over the parties before it.* It is clear

5. The concept of a void judgment is extremely limited.

V.T.A., Inc. v. Airco, Inc., 597 F.2d 220, 225 (10th Cir. 1979);

Coalition of Black Leadership v. Cianci, 570 F.2d 12, 15 (1st Cir.

1978) (quoting Lubben v. Selective Service System, 453 F.2d 645,

649 (1st Cir. 1972)); Ben Sager Chemicals v. E. Targosz & Co.,

560 F.2d 805, 812 (7th Cir. 1977). Professor Moore indicates the

concept is so narrowly restricted that, although seemingly incon-

gruous, a federal court judgment is almost never void because

of lack of federal subject matter jurisdiction. See 7 Moore’s, supra

1 60.25[2], at 305-06.

6. See, e.g., Chicot County Drainage Dist. v. Baxter State

Bank, 308 U.S. 371 (1940) (federal statute that was basis for

decree subsequently ruled unconstitutional, nevertheless court

had jurisdiction over parties and could pass implicitly on its jur-

isdiction over the claim or statute’s constitutionality, even if its

holding were erroneous) ; Stoll v. Gottlieb, 305 U.S. 165, 171 (1938)

(no jurisdiction in federal bankruptcy court over subject matter

of order, court with jurisdiction of parties nevertheless could

erroneously decide there was); Marshall v. Board of Educ., 575

F.2d 417, 422-23 (3d Cir. 1978) (application of statute to certain

defendants later held to be unconstitutional, nevertheless judg-

ment was not void since the court had jurisdiction to erroneously

pass on the issue) ; 7 Moore’s supra {| 60.25[2], at 302 (2d ed. 1979).

Often determination of subject matter jurisdiction rests upon

a finding of jurisdictional fact, rather than, as in this case, con-

struing a statutory grant of jurisdiction. When facts must be

(Continued on following page)

ASI

that the district court had original jurisdiction to decide

GLC’s and the Railway Co.’s claims under 28 U.S.C.

§ 1337(a); it also had jurisdiction to review the ICC order

entered upon referral under 28 U.S.C. § 1336(b).’ It had

jurisdiction over the general subject matter and accordingly

could decide whether the United States should be joined

and whether its nonjoinder was a jurisdictional defect.

Even assuming the district court erred, the error has no

bearing on its power to decide those issues.

The district court implicitly decided whether joinder

of the United States, a prerequisite for review under 28

U.S.C. §§ 2321(a), 2342, was also required for it to review

an order under 28 U.S.C. § 1336(b). With jurisdiction

over the type of case and over the parties, the court could

enter a judgment for money damages. In doing so, it

could determine whether it had jurisdiction to entertain

the parties’ motions for summary judgment and for this

purpose construe and apply the statutes under which it was

requested to grant relief. An erroneous decision on the

interpretation and applicability of sections 1336(b) and 2322

would not deprive it of power to decide. As the Supreme

Court has stated:

Whatever the contention as to jurisdiction may

be, whether it is that the boundaries of a valid statute

Footnote continued—

proven before a court will exercise its jurisdiction, voidness often

turns upon the distinction between essential jurisdictional facts

such as service of process or location of the res, and quasi-juris-

dictional facts such as diversity of citizenship or amount in con-

troversy. See Noble v. Union River Logging R.R., 147 U.S. 165,

173-74 (1893); see, e.g., Lubben v. Selective Service System, 453

F.2d 645, 649 (ist Cir. 1972); Independence Mortguge Trust v.

White, 446 F. Supp. 120 (D. Ore. 1978). Federal subject matter

jurisdiction turns upon findings of quasi-jurisdictional facts. 7

Moore’s, supra J 60.25[2], at 307 n.59.

7. This latter jurisdictional basis assumes, although we do

not decide the issue here, that the district court was reviewing an

ICC order, rather than acting in the realm of its own original

jurisdiction with the benefit of an ICC advisory opinion.

A52

have been transgressed, or that the statute itself is

invalid, the question of jurisdiction is still one for

judicial determination.

Chicot County Drainage District v. Baxter State Bank, 308

U.S. 371, 377 (1940).

Under the circumstances, the judgment may not be va-

cated under Rule 60(b) (4). Marshall v. Board of Educa-

tion, 575 F.2d 417, 422 (2d Cir. 1978); Coalition of Black

Leadership v. Cianci, 570 F.2d at 15-16 (by implication);

Ben Sager Chemicals v. E. Targosz & Co., 560 F.2d at 812;

cf. Jackson v. Irving Trust Co., 311 U.S. 494 (1941) (mo-

tion to set aside, prior to promulgation of Rule 60(b) (4)).

Competing policies are at stake in setting aside a fed-

eral court judgment as void for lack of subject matter

jurisdiction: observation of limits on federal jurisdiction

and need for judgments that are final. However, when

the challenge is to an erroneous interpretation of a stat-

utory grant of jurisdictfon and the judgment is not ap-

pealed, thus becoming final, the policy favoring certainty

in judicial resolution of controversies prevails.

The panel opinion is ordered vacated and the district

court judgment affirmed.

ROSS, Circuit Judge, Concurring.

I concur in the majority opinion not only for the rea-

sons stated therein, but also for an additional reason. In

my opinion the United States was not an indispensable

party to the counterclaim portion of the case under 28

U.S.C. §§ 2321-23, and therefore there was no jurisdictional

defect as indicated by the panel decision.

The counterclaim was not, as required by section 2321,

“a proceedings to enjoin or suspend * * * a rule, regula-

A53

tion or order of the Interstate Commerce Commission” or

“an action to enforce * * * any order of the Interstate

Commerce Commission.” Rather it was an action “for the

payment of money” which is specifically exempted from

the provisions of section 2321. If section 2321 is not in-

volved, then by its terms section 2322 is not involved either

and it was not necessary to join the United States as a

party. I believe that 28 U.S.C. §§ 2321-23 was meant to

apply to appeals to our court from an order of the ICC,

not to appeals to our court from a district court case in-

volving an action “for the payment of money.”

McMILLIAN, Circuit Judge, Dissenting.

After carefully considering the majority opinion and

the concurring opinion, I continue to adhere to the general

analysis set forth in the panel decision and therefore dis-

sent.

To the extent relief under Rule 60(b)(4) enables a

party to evade the doctrine of finality of judgments and

to in effect appeal indirectly from a final judgment, I

think this is the function of Rule 60(b) (4). In my view,

the judgment of the district court is void for lack of sub-

ject matter jurisdiction because, as is apparent from the

face of the record, the United States was not a party to

the proceedings below. In the present case, the failure

to join the United States is a “fatal” jurisdictional defect.

See Schwartz v. Bowman, 244 F. Supp. 51, 69 (S.D.N.Y.

1965), aff'd sub nom. Annenberg v. Alleghany Corp., 360

F.2d 211 (2d Cir.) (per curiam), cert. denied, 385 U‘S.

921 (1966), citing Lambert Run Coal Co. v. Baltimore

& Ohio R.R., 258 U.S. 377, 382 (1922). The United States

should have been made a party because the action was

a direct review proceeding to set aside or suspend an

A54

order of the Interstate Commerce Commission (ICC)

under § 17(10)! of the Interstate Commerce Act, 49 U.S.C.

1. 49 U.S.C. § 17(10) provides:

Judicial relief from decisions, etc., upon denial or other dis-

position of application for rehearing etc.

When an application for rehearing, reargument, or re-

consideration of any decision, order, or requirement of a

division, an individual Commission, or a board with respect

to any matter or referred to him or it shall have been made

and shall have been denied, or after rehearing, reargument,

or reconsideration otherwise disposed of, by the Commission

or an appellate division, a suit to enforce, enjoin, suspend, or

set aside such a decision, order, or requirement, in whole or

in part, may be brought in a court of the United States under

those provisions of law applicable in the case of suits to en-

force, enjoin, suspend, or set aside orders of the Commission,

but not otherwise.

This section was formerly numbered § 17(9) and was added to

the Interstate Commerce Act in 1940 by the Transportation Act

of 1940, ch. 722, § 12, 54 Stat. 916. The Supreme Court char-

acterized this section as “basically a provision requiring exhaus-

tion of administrative remedies prior to resort to the courts.”

ICC c. Atlantic Coast Line R.R., infra, 383 U.S. at 583 n.2. In

1976 this section was renumbered and a new § 17(9) was added

providing new administrative hearing and review procedures.

Act of Feb. 5, 1976, Pub. L. No. 94-210, § 303(a), 90 Stat. 48. In

the Revised Interstate Commerce Act (see note 2 infra) § 17(10) is

now § 10325, which provides:

Judicial review—nonrail proceedings

A civil action to enforce, enjoin. suspend, or set aside an

action of the Interstate Commerce Commission taken by a

division, individual Commissioner, employee board, or em-

ployee delegated to act under section 10305 of this title may

be started in a court of the United States only—

(1) on denial of an application for rehearing, reargu-

ment, or reconsideration; or

(2) if the application is granted, after a rehearing,

reargument, reconsideration or other disposition by the Com-

uae or an appellate division under section 10323 of this

title.

. 10837 § 10325. New § 17(9) (added in 1976) is now 49 U.S.C.

For clarity, I shall refer to a former § 17(9) action (new

§ 17(10) and now codified at 49 U.S.C. § 10325) as a direct re-

view proceeding and a § 16(2) action (now codified at 49 U.S.C.

§ 11705) as an enforcement action.

A55

§ 17(10), as revised and codified? at 49 U.S.C. § 10325,

and not an action to enforce a reparation award under

§ 16(2)* of the Act, 49 U.S.C. § 16(2), as revised and

codified at 49 U.S.C. § 11705. See ICC v. Atlantic Coast

Line R.R., 383 U.S. 576, 579-89, 602-09 (1966) (hereinafter

Atlantic).

As a preliminary matter, I note that the district court

may not have had jurisdiction for another reason, that is,

failure to exhaust administrative remedies. It appears

from the record that neither the shipper (GLC) nor the

carrier (KCS) filed a petition for reconsideration before

the ICC. Denial or other disposition of a timely petition

2. The Interstate Commerce Act was revised and recodified

by the Act of Oct. 17, 1978, Pub. L. No. 95-473, 92 Stat. 1337. The

legislative history clearly indicates that the revision and recodi-

fication was not intended to make any substantive changes but

only to modernize some of the Act’s archaic language. E.g., Chi-

cago & N.W. Transp. Co. v. Atchison, T. & S.F. Ry., 609 F.2d 1221,

1222 n.1 (7th Cir. 1979), citing H.R. REP. NO. 95-1395, 95th Cong.,

2d Sess. 1, 4, 9-10, reprinted in [1978] U.S. CODE CONG. & AD.

NEWS 3009, 3013, 3018.

3. 49 U.S.C. § 16(2) (now revised and codified at 49 U.S.C.

§ 11705) provides:

Proceedings in courts to enforce orders; costs; attorney’s

fees. If a carrier does not comply with an order for the pay-

ment of money within the time limit in such order, the com-

plainant, or any person for whose benefit such order was

made, may file in the district court of the United States for

the district in which he resides or in which is located the

principal operating office of the carrier, or through which the

road of the carrier runs, or in any state court of general

jurisdiction having jurisdiction of the parties, a complaint

setting forth briefly the causes for which he claims damages,

and the order of the commission in the premises. Such suit

in the district court of the United States shall proceed in all

respects like other civil suits for damages, except that on the

trial of such suit the findings and order of the commission

shall be prima facie evidence of the facts therein stated, and

except that the plaintiff shall not be liable for costs in the

district court nor for costs at any subsequent stage of the

proceedings unless they accrue upon his appeal. If the

plaintiff shall finally prevail he shall be allowed a reason-

able attorney’s fee, to be taxed and collected as a part of

the costs of the suit.

A56

for reconsideration may well be a jurisdictional prereq-

uisite to judicial review in a direct review proceeding.

“Section 17(9) [renumbered as § 17(10), recodified as

§ 10325] provides that after an application for rehearing,

reargument, or reconsideration has been denied or other-

wise disposed of, a suit may be brought to enforce, enjoin,

suspend, or set aside the Commission decision, order, or

requirement.” Atlantic, supra, 383 U.S. at 582-83 (foot-

note omitted); see United States v. Southern Ry., 364

F.2d 86, 92-93 (5th Cir. 1966), cert. denied, 386 U.S. 1031

(1967); Southern Ry. v. United States, 412 F. Supp. 1122,

1134-35 & n.31 (D.D.C. 1976); but see Resort Bus Lines,

Inc. v. ICC, 264 F. Supp. 742, 745 & n.6 (S.D.N.Y. 1967).

New § 17(9) suggests, however, that a petition for re-

consideration may not be necessary, at least in rail carrier

proceedings,* because petitions for reconsideration are es-

sentially discretionary and based upon allegations of mate-

rial error, new evidence, or substantially changed circum-

stances, 49 U.S.C. § 17(9) (g) (now revised and recodified

at 49 U.S.C. § 10327(g)). See ICC General Rules of

Practice, 49 C.F.R. § 1100.98 (Rail appellate procedures,

Rule 98) (1979) (also reprinted in 49 U.S.C.A. Appendix).

4. 49 U.S.C. § 17(9)(h) (now revised and codified at 49

U.S.C. § 10327(i) ) provides:

Notwithstanding any other provision of this Act, any

decision, order, or requirement of the Commission, or of a

duly designated division thereof, shall be final on the date

on which it is served. A civil action to enforce, enjoin, sus-

pend, or set aside such a decision, order, or requirement, in

whole or in part, may be brought after such date in a court

of the United States pursuant to the provisions of law which

are applicable to suits to enforce, enjoin, suspend, or set aside

orders of the Commission.

49 U.S.C. § 10327(i) provides:

Notwithstanding this subtitle, an action of the Commis-

sion under this section and an action of a designated division

under subsection (c) of this section is final on the date on

which it is served, and a civil action to enforce, enjoin, sus-

pend, or set aside the action may be filed after that date.

A57

I agree that the district court was the appropriate

court in which to review the order of the ICC at issue.

The district court as the referring court has exclusive

jurisdiction to review ICC orders from referrals under the

primary jurisdiction doctrine. 28 U.S.C. § 1336(b); see,

e.g., Atlantic, supra, 383 U.S. at 580; Southern Pacific

Transportation Co. v. United States, 505 F.2d 1252, 1254-55

(Ct. Cl. 1974); Keller Industries, Inc. v. United States, 449

F.2d 163, 166-67 (5th Cir. 1971); McLean Trucking Co.

v. United States, 181 Ct. Cl. 170, 387 F.2d 657, 659-61

(1967); see also S. REP. NO. 1394, 88th Cong., 2d Sess. 2,

reprinted in [1964] U.S. CODE CONG. & AD. NEWS 3235.

Compare Pennsylvania R.R. v. United States, 363 U.S. 202,

205 (1960) (the holding in this case prompted the amend-

ment of § 1336). The action was initially filed in district

court by the carrier to recover undercharges; the shipper

filed a counterclaim for overcharges. Because the action

raised questions within the primary jurisdiction of the ICC,

the district court correctly referred the issues to the ICC.

E.g., United States v. Western Pacific R.R., 352 U.S. 59,

63-64 (1956). “When that occurs, the court ordering the

reference of such issues to the Commission has exclusive

jurisdiction of any civil action to enforce, enjoin, suspend,

set aside, or annul a Commission order arising out of the

“a referral... .” Atlantic, supra, 383 U.S. at 580. In addi-

tion, as noted by the concurring opinion, the ICC order

at issue was basically an order for the payment of money

and as such subject to judicial review by the district

court. 28 U.S.C. § 1336(a);° United States v. ICC, 337

5. 280U.S.C. § 1336(a) provides:

Except as otherwise provided by Act of Congress, the dis-

trict courts shall have jurisdiction of any civil action to en-

force, in whole or in part, any order of the Interstate Com-

merce Commission, and to enjoin or suspend, in whole or in

' part, any order of the Interstate Commerce Commission for

the payment of money or the collection of fines, penalties,

and forfeitures.

EAE Ree Te ee a ER

A58

U.S. 426, 442 (1949); Aluminum Co. of America v. United

States, 553 F.2d 1268, 1269-70 (D.C. Cir. 1977) (per

curiam ).

In my view, however, the shipper’s motion for sum-

mary judgment, which was granted by the district court,

was either an action to set aside the ICC order finding

that the higher specific commodity rates, as modified by

the ICC, were applicable to the shipments at issue or an

action challenging the adequacy of the reparations award

(to the extent the carrier recovered less than it demanded).

In either case, judicial review was available only in a

direct review proceeding (under old § 17(9) or new § 17

(10) of the Act), and not in an action for enforcement

under § 16(2). In the absence of a reparations award,

there is nothing upon which to base an enforcement action,

see Atlantic, supra, 383 U.S. at 587; United States v. ICC,

supra, 337 U.S. at 439-41, and a shipper cannot challenge

the adequacy of a reparations award in an enforcement

action, see Atlantic, supra, 383 U.S. at 587, citing Baltimore

& Ohio R.R. v. Brady, 288 U.S. 448, 457-58 (1933); D. L.

Piazza Co. v. West Coast Line, 210 F.2d 947, 949 (2d Cir.),

cert. denied, 348 U.S. 839 (1954).

The characterization of the action below as a direct

review proceeding and not an enforcement action is critical

because, although both involve “orders for the payment

of money,” only § 16(2) actions for the enforcement of

orders for the payment of money are brought as ordinary

civil actions. 49 U.S.C. § 16(2); Atlantic, supra, 383 U.S.

at 585. In contrast, direct review proceedings are distinct

proceedings for judicial review and have special procedural

requirements, in particular that such actions be brought

by or against the United States, 28 U.S.C. § 2322. Orig-

inally, injunctive relief required a three-judge district

court, 28 U.S.C. § 2325, with direct review to the Supreme

A59

Court under 28 U.S.C. § 1253. However, §§ 2324-25 were

repealed in 1975, Act of Jan. 2, 1975, § 7, Pub. L. No.

93-584, 88 Stat. 1918, and judicial review of orders other

than for the payment of money or to enforce ICC orders

is now in the courts of appeal, like review of other ad-

ministrative agencies, with discretionary review by writ

of certiorari in the Supreme Court. 28 U.S.C. §§ 1254

(writ of certiorari), 2341 et seq. (Judicial Review Act of

1950 (Hobbs Act) ); see generally H.R. REP. NO. 93-1569,

93d Cong., lst Sess. 1, reprinted in [1974] U.S. CODE

CONG. & AD. NEWS 7025, 7034-36 (report of Department

of Justice).

The action below was, in my opinion, a direct review

proceeding to review an adverse reparations order. The

fact that the ICC order under attack was one relating

to the payment of money and thus in sustance one for

the payment of money meant that the order was “not

of sufficient public importance to justify the accelerated

judicial review procedure [the three-judge district court

and direct review by the Supreme Court].” United States

v. ICC, supra, 337 U.S. at 442. “Thus, though the proce-

dures set out in 28 U.S.C. §§ 2321-25 (1964 ed.) otherwise

govern § 17(9) proceedings to review such orders, § 2325

is not applicable and the matter may be adjudicated by

a single judge.” Atlantic, supra, 383 U.S. at 585. The

provision requiring a three-judge district court (now re-

pealed, see discussion supra) does not apply to judicial

review of adverse reparations orders, but the other pro-

visions, including that requiring the action be brought

against the United States, are applicable. Moreover, a

reviewing court ‘‘may not formally set aside the Commis-

sion’s order in an action in which neither the Commission

nor the United States is a party.” Atlantic, supra, 383

U.S. at 549.

A60

In response to the argument that an action to set

aside an order for the payment of money should be

treated exactly like an action to enforce an order for

the payment of money, I note that the Supreme Court in

the Atlantic case addressed a similar argument. In that

case the ICC resisted allowing a carrier to bring a direct

review proceeding as a cross-action to the shipper’s en-

forcement action. The ICC argued that “reparation orders

respecting past rates are not of sufficient general impor-

tance to require their defense by the United States and

the Commission, and the direct review proceeding should

not be permitted regardless of the court in which it is

brought.” Atlantic, supra, 383 U.S. at 605. The Supreme

Court stated that this was apparently not the view of

Congress and cited the 1964 amendments which placed

jurisdiction and venue of the direct review proceeding

following reference to the ICC under the primary juris-

diction doctrine in the referring court, 28 U.S.C. §§ 1336

(b), 1398(b), in the referring court and not as an incident

of the original action. Atlantic, supra, 383 U.S. at 605-06.

Thus, an action for direct review of an ICC order, which

must be brought against the United States, may involve

an order “for the payment of money.” Apparently only

actions to enforce an order for the payment of money

pursuant to § 16(2) of the Act do not require the United

States as a party to the action.°

6. See generally Atlantic, supra, 383 U.S. at 579-89, 605-06.

In my view, actions to enforce orders for the payment of money

are brought in the 2istrict courts, 28 U.S.C. § 1336(a), as any

other civil action, 49 U.S.C. § 16(2); the United States need not

be made a party. However, actions to enforce non-payment

orders, although properly brought in the district courts, 28 U.S.C.

hae a), must be brought by or against the United States, 28

S.C. §§ 2321(b), 2322. Actions to set aside orders for the pay-

ment of money are brought in the district court and not the courts

of appeals; such actions fall within the “Except as otherwise pro-

vided by an Act of Congress” language of 28 U.S.C. § 2321(a).

28 U.S.C. §§ 1336(a), 1336(b) (referral actions); see also United

(Continued on following page)

A6é1

As noted by the Supreme Court, the statutory provi-

sions controlling the availability of judicial review in this

case are “an historical patchwork subject to more than

one interpretation.” Atlantic, supra, 383 U.S. at 586 n.4.

Nonetheless, because the proceeding below was a direct

review proceeding to set aside an ICC order for the pay-

ment of money and as such should have been brought

against the United States, but was not, I would find that

the district court lacked subject matter jurisdiction and

would reverse the denial of the Rule :60(b)(4) motion.

BRIGHT, Circuit Judge, joining in the dissent.

I join in Judge McMillian’s dissent. When the case

was returned to the district court, the shipper moved

for a summary judgment on its counterclaim, seeking a

construction of the tariff inconsistent with the Commis-

sion’s ruling. That motion triggered the statutory pro-

cedures for review of an ICC order, which require that

the United States be joined. 28 U.S.C. § 2322 (1976).

The statutes preclude a federal trial judge from making

a tariff interpretation without complying with the proce-

dures mandated by Congress; thus, such ruling amounts

to a nullity.

In Schwartz v. Bowman, 244 F. Supp. 51 (S.D.N-Y.

1965), aff'd sub nom. Annenberg v. Alleghany Corp., 360

F.2d 211 (2d Cir.) (per curiam), cert. denied, 385 U.S.

921 (1966), the court appropriately observed:

Footnote continued—

States v. ICC, supra, 337 U.S. 426 (direct review of adverse repara-

tions order before single-judge district court). Such an action

must be brought by or against the United States, 28 U.S.C.

§§ 2321(a), 2322. Finally, actions to set aside non-money orders

are propery brought in the courts of appeals and by or against

the United States, 28 U.S.C. §§ 2321(a), 2322, unless the under-

lying order was referred to the ICC, in which case the referring

court has exclusive jurisdiction. 28 U.S.C. § 1336(b).

A62

If it can be established extrinsically that the practical

effect of success on the merits by the party making

a claim would be to invalidate the [ICC] order, [28

U.S.C. § 2322] applies and its requirements must be

met. [Id. at 68 (citations omitted).]

The absence of the United States as a party was ‘a fatal

jurisdictional defect.” Id, at 68. Thus, the judgment was

void.

Moreover, I find nothing in the record that indicates

that the district court expressly or impliedly made a

determination that it had jurisdiction to overrule the Com-

mission’s order construing the tariff in question. Neither

party called the court’s attention to the relevant statutory

sections, 28 U.S.C. §§ 2321-23, and the district court appar-

ently assumed it could overturn the Commission’s ruling.

I find nothing in the record to show that the district court

considered whether it possessed jurisdiction to overrule

the Commission solely on the shipper’s motion. The juris-

dictional issue did not surface until the Railway Co.

brought its motion for relief from a void judgment under

Fed. R. Civ. P. 60(b) (4). The district court then should

have corrected its jurisdictional error and granted the

motion. Accordingly, I, too, would reverse.

Judge Heaney joins me in the views expressed in

this dissent.

A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS,

EIGHTH CIRCUIT.