Petition for a Writ of Certiorari — Flying Tiger Line, Inc. v. Murphy

Supreme Court brief1966

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Offiee-Supreme Court, U.S.

FILED.

- ge BOE AUG 31 1966

| Ay -ge'- 8 | JOHN F. DAVIS, CLERK

o~.- —

i Ty, THE

‘Sie Court af the 3 United States _

October Term, 1966

* . ———

THE Fiyine Tiger Line Ivc., Petitioner,

. CHARLES S. Murpny, m8 as iidividuals and as

* members of the Civi, AERONAUTICS Boarb, Respondeits

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED. STATES COURT OF APPEALS FOR °

THE DISTRICT OF COLUMBIA CIRCUIT

| . Myer FeLpMAN

. ALVIN FRIEDMAN :

ee ee One Famragut Square—

ass: . aan ene South —

7 Washington, D. C. 20006

Of Counsel: | Attorneys for —

Meyers & Dryer Petitioner

1201 Shoreham Building

Washington, D. C. 20005

Ropert M, Hausman

~ Ginssure & FELDMAN °

One Farragut Square South

_ Washington, D. C. 20006

August 1966 - ‘

Press or Byron S. ADAMS PRINTING, INC., WASHINGTON, a. ¢.

Sto

* TABLE OF CONTENTS

ry ae Page

SE FE ohn vnn-b-ns donde cardenkisksdedsaesaes _—

- Jurisdiction :...........4. Sienna ee ers ae

Questions Presented ai ee weeee O

Statutes Involved ..........-. ee pvabeeeens Sueecsnee “3

_ Statement .... sia beens Lee A Tae PEO P,

Reasons for Granting the Writ ,.............0.00- <. 12-

A. The Board’s narrow reading of Section 401(e)(6)

: of the Federal Aviation Act discriminates against .\

the all-cargo carriers in favor of the combination ~

. erry Tyree are Dheisebetesceabwset s) 12 .

B. Part 207 so restricts and discriminates against the

‘all-cargo carriers as to be totally destructive of —

. the statutory rights.to perform charter services : .

. that Section 401(e) (6) grants to them .....4.... 19

| C. The Board had before it in the rule-making pro-

ceeding no information whatsoever that could sus-

. ing Part 207-....0.6. 2.65. ten eae shee 22

Federal Aviation Act requires .z.............. 24

Conclusion ..... Kéuksdnccwie es vedi erereree ‘vekesa 7a

‘Appendix A—Opinion of the Court of Appeals .:.... 1a .

P | » Appendix B—Statutes pineees Soerukee aa a. Sieeics ae

e. -.. _-* Indéx Continued |

INDEX TO CITATIONS ~~ ae

CASES : ie ee ,

Airlift Renewal Proceeding, Order w0-24082, C. A.B. Dkt.

No. 11749, June 30, 1966 . CT ec cee ese we

American Airlines, et al_w Civil Laleniaties Board.

Supreme Court; No. 304, October Term, 1966 (Nos. |

18 333, 18,834, 18,840, U.S. App. D.C,, March 2,<

_ a

J, atibseksdaksdhesoeasascesteneia shania 10, 24"

American Trucking Ass’ns v. United States, 344 U. Ss. |

f 2OB- (19GB). 2.0. reccccccaccccccseccvesssecesitce 22

hog Airways v.. Civil Aeronautics Board, 87 ws.

App. D.C.-71, 182 F. 2d 705 (D.C. Cir. 1950), cert.

‘denied, 340, U.S. 828 CRE whaddeses cCoanbaas 6

_ Civil Aeronautics Board v. Delta Air Lines, 367 US. -

=, MP GEMMA pscccacaccqabbececascecccadinecsdes 19

Civil Aeronautics Board v. Summerfield, 347 US. 924 )

; SE cdi Ris ete sindks Keebdedesnsckaenens 20

Federal Communications Connniasion v. American

Broadcasting Co., 347 U.S. 284 (1954) .......... 19

Helvering v. Credit Alliance Corp., 316 U.S. 107 (1940) 19.

International Ry. Co.,.v. Davidson, 257 U.S. 506 (1922) 19

._Lynch v. Tilden Produce Co., 265 U. S. 315 (1924) .. 19

- Manhattaw General Equipment Co. v. Commissioner

of Internal Revenue, 297 U.S. 129 41935) ........ 19

- Miller v. United States, 294 U.S. 435 COED adwncccese, Ee

Pacific Northern Airlines v. Alaska Airlines, 80 F*.

“Supp. 592 (D. Alaska, 1948) .:............es000. 15

Pioneer Air Lines, Inc:, 7 C.A.B. 469 (1942) ........ 15

Safeway Trails, Inc. v. ‘Interstate Commerce Commis-"

ston, 176 ‘F. Supp. 201 (D.D.C“1959), aff’d per

curtam, 361 U.S. 86 (1960) ............ 0c. eed 16

Slick ‘Corporation, Suspension of Scheduled Route #

Service, Order E-23352, March 14, 1966 (C.A.B. ae

Dkt.-No. 16356) ...-0ccscccccccrcseccevesccvases : @

Social Security Board v. _ Nierotko, 327 U.S. 358 (1945) 19

The Flying Tiger Line Inc. v. Civil Aeronautics Board,

92 US. App. D.C. 260, 204 °F’. 2d 404 (D.C. Cir.

Dt critadden ts adhe stantadecencedhateRasenne 15

Utah Gas Pipeline Co. v. Federal Power Couiantacion,

86 U.S. App. D.C. 314, 181 F. 2d 796. (D.C. Cir.

J, 1950), cert. denied, 340 U.S. 827 (1950) .;....:..: —6«6

Western Air Corp. — Grandfather Certificates, i

RA OP EIIMD Wo ncs'es -Svesvaccnectcececeyys’ 15

sae =

Index Coitiimed = ii

a 2 eo |

i age

SraTuTES AND ReGuLATions: oat

“ Administrative Procedure Act, 60 Stat. 237, as.

amended, 5 U.S.C. § 1001 et seq.

OY Rae pire See apa 8

_ SY Sees FETS Ea ene .. 10

RR RR ee, “ee ct ent aime tern ne pe 10

‘Civil Aeronautics Act. of 1938, 52 Stat. 973

Ec chek i cindnkehentees ass Suneesws 15

"Péderal Aviation Act of 1958, 72 Stat. 731, as amended;

49 U.B.C. § 1301 et seq.

Sec. 401(d) ...... iwetibeweue Leweaseees oe

See: 401(e).......... ($os0000864000s000008 OF

EEE in coc kbs reese ds cdeenssoene 15

Sec. 401(e)(4) ........... OLE PE es, Pee 15

* Sec. 401(e)(6) .......... icaendeesennenl 6 et seq

REAPS SPREE Ea ann ae 10 et seq

aig a e OON 0k 5 644 N So Cee es aan ee 18

eh lg ee a era iy n

Motor Carrier Act, 54 Stat: 919, as amended, 49 )U. S: ra

—-§ 301 et seq.

See. DE hiedeknaies ec ee

* 14 C.F.R: § 207°...... ia ais a+ Are ...2 et seq.

OTHER:

__. Application of Airlift. International, They and. Slick

on C.A.B. Dkt. .No. 17622, * aeceaalle 12,

— 2a PE eee een :

I i ei eal abn ages aan o% : ia

H.R. Conf. Rep. No. 1950, 87th Cong. 2d Sess., p.12.. 18 |

‘Schary,. P., Competition, Regulation and, ¥ Air’?

Freight Industry, 30 J. Air L. & Commerce 62, 66

“EE sadcesdedsedeiens inde we teees seo ax eee 5

IN THE -

sine Court of the Rnited States

October Term, 1966

N 0.

a Kee . ‘i . , 2

Cn 7 « ty

| — Fyine Ticer Ling Inc., Petitioner,

“-*. |

; Cartes 8. MURPHY, ET AL., as individuals and as

ae Members of the Une: AERONAUTICS Boarp, eee

. PETITION rhe wane OF CERTIORARI TO THE

| UNITED STATES COURT OF APPEALS FOR.

“ r THE DISTRICT. OF COLUMBIA CIRCUIT

Petitioner, The- Flying Tiger Line Ine, ‘prays that,

a writ of certiorari issue to review a judgment | of the.

United States Court of Appeals for the District’ of

~ —- Circuit entered on June 2, 1966.

‘ “ys OPINIONS BELOW

The opinion ‘of the Court: of: Appeals, not a re-

ported, is reprinted at Appendix -A,.p. la below. The .

- opinion of the United States.District Court for the

District of Columbia is reported at 244 F. Supp. 889° “

“(D. D &. 1965). The’ a and ee: of the.

: . 9 |

Civil Aeronautics Board (hereafter referred to as a i

- “Part 207”) of which Petitioner sought review by -

. the District Court and by the Court of Appeals/below

\ are printed in the Board’s Economic Regulations and

Economic Regulations Preambles (29 Fed. Reg. 13246, ~

ee as C.F.R. 207).. The opinion of the Distri

Court and the opinion and regulation of the Board are

- ‘yeprinted in the Joiut Appendix printed for the use of la

_ the Court of Appeals (J.A. pp. 15 et seq.; 105 et seq.).*

»' °° +7 JURISDICTION

The judgment of the Court of Appeals (Appendix A,

p. la below) was entered on June 2, 1966. The juris-

diction of this Court is invoked under 28 U.S.C. .

§.1254(1). | | —

QUESTIONS PRESENTED

1, Whether the .Civil Aeronautics Board miscon- .,

strued Section 401(e) (6) of the Federal Aviation Act,

which ‘authorizes air carriers holding route certificates.

to perform charter services, in confining this section

of the Act'to “‘off-route” charters only, with the result

that the Board’s Economie Regulation (Part 207) gov-

’ erning charter services imposed an unlawful discrim-

ination between all-cargo carriers and combination car- a,

riers in the performance of passenger charters. |

’ @Nine additional copies of the Joint Appendix have been filed

with this Court for use in passing upon the Petition. See

Rule 21(3) of the Court’s Rules. ‘‘J.A.’’ citations are to this

. Joint Appendix. Petitioner liks also filed with this Court all rele- |

vant portions of the record made before the Board in the rule- |

making proceeding that resulted in the issuance of Part 207. This

five-volume record was part of the record in the case before the

District Court and before the Court of Appeals. Citations thereto

appear herein as “‘Tr.——.”’ -

2. Whether Part 207, oer after a niiveuiies

proceeding under the Board’s authority pursuant to

Section 401(e) (6): to regulate charter services, so re-

_ Stricts and discriminates against the all-cargo carriers

-as to destroy the statutory“rights to perform charter

services that Section 401(e) (6) grants to them.

3. Whether Part 207 should ra stricken as arbitrary -

and capricious because the purported basis and pur-

pose upon which the Board promulgated the regula-

tion is totally unsupported by any information adduced

_ in the role‘makimg proceeding.

4. Whe the Board, or any ‘eileen agency,

may take action based upon a rule-making proceeding

alone to: deprifé\common carriers holding certificates

of public convenience and necessity of rights that the

governing regulatory statute incorporates into those —

' certificates, when the statute provides that a certificate -

ean be amended or modified only upon specific findings

pp. 2a et seq. below.

by the agency after notice and an evidentiary hearing.

STATUTES AND REGULATIONS INVOLVED

The provisions, of the Federal Aviation Act, the

Motor Carrier Act and the Administrative Procedure :

Act principally’ involved are set forth i in Appendix B,

STATEMENT

Transporation services by aigearriers divided

broadly into two major categories: scheduled services

and charter services. This case presents important

questions of law concerning the regulation by the Civil

- Aeronautics Board of the second of major cate-

gories of air transportation.

In harter service a carrier employs, its aircraft

-_ | — specific points undér contract with specific

rr J

parties for specific: occasions, Scheduled service, on

the other hand, és provided at set times over routes

that the Board has awarded to specified carriers—the

“route” carriers—under certificates of public conven-

ience and necessity. Passengers and cargo are car-

vied in both categories of service, Charter services

are condiicted by the “route’’ carriers as well as by a

separate group of “supplemental”? carriers'who engage

in no scheduled services. |

Charter services are a large source of revenus for

many route carriers, Charter. revenues contribute

-eritically to the financial stability and eeonomie viabil-

ity of one particular group of four relatively small

route carriers. ‘These are the all-cargo carriers of

whom Petitioner is one.* > Tt is against these carriers .

that the adverse economic impact of the decisions below

strikes heavily. Their certifirates grant them routes

only for. the transport of property and mail,and not—

as is the case with the cértificates of the ‘combina- |

tion” carriers—for the transport of passengers as well.

Passenger and cargo charter services by the cargo car-

riers are essential for the economic utilization of their

equipment and to: enable them to compete effectively

* One of these, Slick Corporation, reveled Board apprea in

August 1965 to suspend its scheduled service because of that car-

rier's serious financial difficulty. Slick Corporation, Suspension of

Scheduled Route Service, Order’ E-23352 C.A.B. Dkt, No. 16856,

March. 4, 1966 ( continuing. suspension). Airlift International,

Inc., another all-cargo carrier, and Slick have applied to the Board

for the transfer of Slick’s certificate to Airlift to enable the latter.

carrier to operate Slick’s route. Application of Airlift ‘Interna-

tional. Inc., and Slick Corporation, C.A.B. Dkt. No. 17622, August

12, 1966. Airlift has so far been denied permanent route authority

for the reason, among others, that the Board considers that it, too,

is in financial difficulty. Airlift Renewal Proceeding, Order

E-24032, C.A.B. Dkt. No. 11749, June 30, 1966; Examiner’s Deci-

sion. March 22, 1966. . |

with the cargo operations of the combination carriers.”

In 1964, for example, Petitioner’s charter services

(other than military charters) represented 16% of its

total annual revenues, the-loss of which would have

_ caused a substantial castes ai loss for the year (J.A. - |

. 54). o

In Seipiciaibiin 1964, following a rule-making pro-

| covding and without an evidentiary hearing, the Civil -

Acronauties Board revised Part 207 of its Economic.

Regulations, which govern the charter services of the

route. carriers. In describing the proposed regula-

. tion, the Board recognized, its broad impact on the

air transportation industry when it stated: ‘Part

207 is a major regulatory proposal which could have .

a significant effect-with respect to all classes of car-

‘riers.’’"** The Board’s statement was amply borne

out as to the cargo carriers, for the effect of the re-

vised Part 207 was to deprive them almost entirely

of their much-needed charter revenues. .The Board

thereby placed in serious jeopardy the ability of these

' earriers to grow and develop in competition with the.

combination carriers and the supplemental carriers.

‘To secure judicial review of this alarming action

by the Board, Petitioner brought suit in the District.

Court for declaratory judgment and injunction to set —

aside ner portions of Part 207 and to challenge the

* See, onientin Schary, To Competition, Senititien and the

Arr Freight Industry, 30 J. Air L. & Commerce 62, 66 (1964);

opinion of dissenting Board Member Gurney in the Part 207 rule-’

making proceeding (J.A. 40).

** Supplemental Notice of Proposed Rule-Making and Notice of

Oral Argument, EDR48F and PSDR-8D, June 22, 1964 (29

Fed. Reg. 8121).

t 6

Board’s administrative procedure j in pronmigating the

regulation (J.A. 2 et seq.).*

The complaint objected to Part 207 chiefly on the ©

ground that the restraints it imposed on charter serv-

‘ices by Petitioner—and by. the other all-cargo car-

riers—so restricted and so discriminated against the

carriers as to. be openly at odds with the express stat-

utory grant of charter authority contained in the Fed-

eral Aviation Act, Section 401(e)(6) of the Act.

That ‘section, as amended by Congress in 1962 spe-

cifically at the urging of Petitioner, among others, had

enlarged the charter authority of the route car-

riers. P.L. 87-528, 76 Stat. 143. The amendment

authorized any such carrier to provide charter serv-

jees ‘‘without regard to... the type of service’? named

in its certificate, thus adding to the route car-—

riers’ long-standing | ‘authority to conduct charters

‘‘without regard to the points named in its. cer-

tificate.’’** The language of: the 1962 amendment, |

*The district courts and not the courts of appeals have juris-

diction of such a suit in the first instance. The original jurisdic-

tion of the latter is confined to proceedings seeking judicial review

. by ‘‘orders’’ of the Board. By contrast, ‘‘reghlations’’ of the

Board, issued after a rule-making. proceeding that does not encom-

pass an evidentiary hearing, are reviewable initially in the district

courts by a suit for injunctive relief. Arrow Airways v.,Civil

Aeronautics Board, 87 U.S. App. D.C. 71, 182 F. "Od 705 (D.C.

Cir. 1950), cert. denied, 340 U,S. 828 (1950) ; Utah Gas Pipeline

Co.’ v. Federal Power Commission, 86 U.S. App. D.C. 314, 181 F.

24 796 (D.C. Cir. 1950), cert. denied, 340 U.S. 827 (1950); See-

+ tion 1006 of the Federal Aviation Act of 1958, 72: oe. 795, as

amended, 49 U.S.C.-§ 1486. 7

. ** Section 401 (e)(6) reads-in its entirety :

‘‘Any air carrier, other than a supplemental air carrier,

may perform charter trips or any other special service, with-

out regard to the points named in its certificate, or the type

» of service provided therein, under regulations prescribed by

thé Board.’’

Petitioner believed, authorized the all-cargo carries»

to engage in passenger charters as well as cargo char-

ters. 'Vhat right. previously, had been denied to them-

under Section 401(f) of the Civil Aeronauties Act of

1938, the earlier statutory provision governing charter:

services.

In adopting revised Part 207, the Board (in a 3-2

decision, Members Gurney ‘and Gilliland dissenting)

used its power under Section 401(e) (6) to “prescribe __

regulations” that effectively reversed the action of Con-

gress by continuing, for all practical purposes, the .

exclusion of passenger charters and limiting drastically

even cargo charters by the all-cargo carriers. The

Board construed Section 401(e)(6), as it had done

- previously,* as authorizing only ‘‘off-route” charters—

that is, between points that are.not on’a carrier’s

certificated route (J.A. 16, 22). The Board then pro-

ceeded to define passenger charters by the cargo car-

__¥iers as ‘‘off-route’’ whether or not such a charter

was performed over the carrier’s certificated route

(J.A. 32). In addition, the Board limited each ear-

rier’s annual ‘‘off-route’’ charter mileage—whether

passenger-or cargo (except military charters) —to 2%

of its annual total revenue plane miles flown ‘‘on-

route’’ in scheduled services, -

As a consequence, all passenger charters by the cargo

carriers fell within the 2% restriction while passenger

_ charters by combination carriers over their certificated

routes were inno way restricted. And the 2% restric-

* ER-375, March 26, 1963, 28 Fed. Reg. 3078; Notice of Proposed

Rule-Making, EDR.48B, January 13, 1964,.29 Fed. Reg. 1476.

\ ‘

« \

tion was calculated for the all-cargo carriers on the

basis of their scheduled service miles only, even though

these carriers had comparatively little scheduled serv-

ice mileage. On the other hand, the combination car-

“e riers typically had enormous scheduled service’ traffic

and could ra: year-to-year increases that made

the 2% limitation nimportant. . ae

Under Section 4 of the Administrative Pisesdure

Act (Appendix C, ps1la)}, the Board was required to

- provide a ‘“‘statement of [Part: 2078] basis ‘and pur-

« pose.’ Only _one~ consideration appears from the

s Board’ s opinion that could reasonably be cited as the

‘basis and’ purpose’’ of the regulation. The Board

stated that its restrictions on charter services by cer-

tificated carriers -were designed to assure that these

" earriers ‘‘do not place undue emphasis on charter op-

erations in derogation of their obligation to perform

adequate scheduled service’”’ (J.A.17). Yet the Board

neither cited in its opinion nor: had presented to it

in the rule-making proceeding even one instance of

threatened or actual deterioration of route service by

_ any certificated carrier .as a result of charter opera-

tions. Petitioner itself has’never been the object of

any complaint alleging inadequacy of scheduled serv--

ice (J.A. 49-50, 55).

*The Board. also authorized - the all-cargo carriers to conduct

unrestricted cargo charter services in their ‘‘designated geo-

graphic area of service [or operations] ” (J.A. 22). For Peti-

tioner, the Board determined this area to be the contiguous 48

states, but it also awarded this ‘‘area of operations’’ to two of

‘the other all-cargo carriers. Apparently because no U.S. all-cargo

carriers are certificated for the Pacific, Africa, Middle East and

- South Asia areas, the Board neglected these ‘‘areas of operations.’’

- ‘Cargo charters in‘these areas accordingly remain - route’’ and

are subject to the 2% restriction.

No economic or industry analysis or other expres-

sions of administrative expertise supported the Board’s

attempted explanation Jt the 2% restriction—except

that this figure represented a “historical balance be--

' tween the route carriers’ route [scheduled] services and

off-route charters” (J.A. 18). N othing appears in the

opinion to suggest that the Board considered other

. reasonable alternatives. Nowhere did the Board con-

sider the adverse impact the 2% restriction would have

_. onthe ability of the all-cargo carriers to use their

operating equipment effectively and economically. No

justification was given for the uneyen, crippling effect

_ of the 2% restrictiongpri the cargo carriers as com-

pared to its bland impact on their major cargo com-

- . petitors, the combination carriers,

Petitioner’s complaint in the D:strict Court sought |

. to set: aside the crippling provisions of Part 207 on

several grounds.’ Petitioner asserted: (1) -that the

» Board lacked statutory authority to restrict passenger

charters by cargo carriers over their certificated routes _

without similarly restricting the combination carriers

(J.A. 6-7); and (2) that the 2% limitation imposed

by the Board was tantamount to a, proscription of all]

charter services by the cargo ‘carriers, such as Peti-

tioner, whose ‘“‘economic survival in the immediate

future is directly dependent upon continuation of rev-

“enues from such charter operations’’ (J.A. 11): It

. was further alleged that no information was presented

in the rule-making proceeding that bore any. reason-

able relationship to the Board’s stated ‘basis and pur-

pose’’ in promulgating Part 207, and that the regula-

tion accordingly should be enjoined as arbitrary and

capricious for’ this separate reason (J.A. 8-10).

& |

; 10 .

The complaint also asserted that Part 207 was in-

~ validly issued on the independent ground that the reg-

‘ulation effected modifications in. Petitioner’s certificate

of public convenience and necessity which could law-

fully be brought about only by .an adjudicatory pro-—

- eeeding, as provided for by Section 401(g) of the Avia-°

~ tion Act (49.U,S.C. § 1371(g)). This section contem-

* plates. the holding of an evidentiary hearing and the

creation of a formal sa of witness and documen-

tary evidence that will permit effective judicial review

of ageucy action: § ions 5 and 7 of the Adminis-

trative Procedure Act, 5 U.S.C. §§ 1004, 1006. ‘The

route carriers, including Petitioner, voiced these

' objections to the Board in the course of the rule-mak-

ing proceeding (J.A. 19-20; Tr. 1436).

Petitioner’s objection to the administrative proce- _

‘ dures followed by. the Board presents a question that

is on all fours with the chief question now being pre-

sented. by othergpetitioners i in this-Court—¢ertain com-

bination, earriers—in a related case decided by the

court below en banc, American Airlines, et al. v.

Civil Aeronautics ‘Board (Nos. 18,833, 18,834, 18,840,

U.S. App. D.C. 1966), No. 304, October Term,

1966 (petition for writ of certiorari filed June 30, :

1966). That petition asks the Court to review,

inter alia, whether the Board should have held an

evidentiary hearing prior to the. issuance of Part

‘399; a Board “‘Policy Statement’”’ having essentially

the effect of a regulation, that authorized the use of

certain cargo tariffs, known as ‘‘blocked space’’ tariffs,

by the all-cargo carriers but denied these tariffs to

the combination carriers. The Board’s Policy State-

ment on “blocked space” and its revised Part 207

regulation governing charter services. were promul-

— as a — of the same — pro-

ceeding; there was a-common notice of proposed rule- |

making, a joint hearing and a joint record.* :

The District Court rejected Petitioner’s challenges .

to Part 207 and to -the administrative: procedure fol-

* lowed by the Board. Granting the Board’s motion

to dismiss the complaint, the court ruled that Part

2@ did not exceed the Board’s statutory authority

under Section 401(e) (6) of the Aviation Act to **pre-

. Scribe limitations and qualifications’? on charter serv-

ices, (J.A. 109); that because Part 207 affected an

entire class of-air carriers rather than particular mem-

_- bers, an adjudicatory hearing was unnecessary (J.A.

109); and that Part 207 did not discriminate against |

the all-cargo carriers but only created a reasonable.

classification as between them and other carriers (J.A.

110). In treating Petitioner’s claim that no informa-

tion had been adduced in the rule-making proceed-

ing that could sustain Part 207’s stated “basis and

purpose,” the District Court appeared to conclude

that no such information was required, although its

- opinion is unclear on this point (J.A. 110).

The Court of Appeals affirmed the judgment of the

District Court in a per curiam opinion (Appendix A,

p. la below) stating that it was ‘‘in’ general agree-

ment’’ with the opinion of the. District Court. In’

disposing of Petitioner’s contention that Part 207 had

been invalidly issued: absent an adjudicatory hearing, —

the court cited its decision in the “blocked space’? case _

(see p. 10 above). .

~ oe ae : |

* See Notice of Proposed Rule-Making, EDR-48, November 13, -

1962, 27 Fed. Reg. 11322 (Tr. 8-11); Notice of Proposed Rule-

_ Making, EDR-48B and PSDR-8, January 13, 1964, 29 Fed. Reg.

1476 (Tr. 182-198). .

Be,

REASONS FOR GRANTING THE WRIT

. The Civil Aeronautics. Board’s revised Part 207 will

~ have far-reaching significance in shaping the extent, — .

and nature of charter service by United States air car- -

‘riers in coming years by fixing the rights of -the onk

combination and supplemental carriers to compete in

- this importarft market. In promulgating Part 207, :

the Board acted on the basis of its reading of the pro- .

vision of the Federal Aviation Act—Section 401(e) (6):

that delineates the scope of the Board’s power to

regulate this important segment of air transportation.

The Court of Appeals and the District Court, in sus- |

‘taining the Board’s reading of the Act, decided an im-

~ portant question of Federal law involving the charter

has not been, but should be, settled by this Court. -

Petitioner additionally submits that’ there exist

~ conflicts “with contrelling decision of this Court in —

‘ the rulings by the courts: below that Part 207 was

within the-Board’s power to. prescribe regulations. for

charter services, that the Board had before it informa-

_ tion adequate to sustain the stated ‘‘basis and pur-

pose’? for the regulation, and that the Board had prop-

erly refused an adjudicatory hearing in connection with

the issuance of Part 207..

_ A. The Board’s Narrow Reading of Section 401(e)(6) of the

Federal Aviation Act Discriminates Against the All-Cargo

Carriers in Favor of the Combination Carriers. . |

-. The Board and the all-cargo carriers have long dis-

agreed over whether Section 401(e) (6) of the Avia--

tion. Act authorizes the carriers té perform charters.

over their certificated routes as well as ‘‘off-route,’’-or

whether the section grants only ‘‘off-route”’ charter —

tights. No judicial decision aoe as the Federal

Aviation ‘Act or its predecessor. statute, the Civil Aero-~

nauties Act, has passed on this question. Yet the

issue is one ‘of significance in the intense competition

between the all-cargo carriers and the combination

earriers for charter’ revenues. And it pronfises to

become inereasingly important as the all-cargo carriers -

progréssively extend their route structures ‘under

certificates that’ may be awarded in proceedings now |

‘pending before the Board:* For in that event, if the -

Board’s reading of Section. 401(e) (6) stands, ‘pas-

_ senger charters over the cargo carriers’ new routes

will continue to be treated as ‘‘off-route’”’. and, there-

fore, subject. to the severe 2% restriction of Part 207.

The Board’s position that Section 401 (e) (6) is con-—

* fined to “‘off-route’’ charters underlies this major ele-

ment. of Part 207. The Board asserts that the authority

ofa certificated carrier to conduct ‘*on-route”’. charters

is a part of the bundle of rights#the Board grants to

- a route carrier in ‘its certificate—and does not derive - re

from ‘the statutory authority of Section 401 (e) (6).

For this reason, the Board concludes, all-cargo-car-

_ riers, who uniformly lack authority to provide route -

passenger ‘service, likewise lack authority to conduct

passenger charters over their routes except_as- the |

Board may determine in regulations, sueh as Part: 207,

issued pursuant: to Section 401(e) (6). |

With this reading of the section, the result, as “

- have ‘already shown (p. 7 _above), is that the 2%

2 e e

oe . 8 There are now poirran applications ie. cargo” carriers for

-. majér routes between the United States and points in the Pacific

‘- Ocean area, Southeast — (including India and. Pakistan) and ve

anage ae | . |

ao a

——

restriction of Part 207 applies to passenger ‘gadtiien by.

the cargo carriers over their certificated rates, but not

to comparable charters of the combination carriers.

If, on the other hand, Section 401(e)(6) were con-

strued to grant both on-route and off-route charter

authority, the Board could not sustain it? distinction

» between passenger charters by the cargo carriers dnd

by the combination carriers. For in such a ease the

operative language of Section 401(e) (6)—‘‘without

regard to the points named in its certificate, or the

type of service provided thereim’’—would plainly com- *

pel the Board to deal even-handedly and’ without dis- .

crimination as between the two major classes of route

carriers. 4

Considerations of statutory consttuetion, precedent

and. legislative history strongly favor ‘this Court’s

review of this question of*law and the rejection of

the view embraced. by the Board and .by the equrts

below.:

1) The Board’s position disregards the inter-rela-

_ tionship between the: certificating “provisions of the

Aviation Act*and those provisions—of which Section

401(e)(6) is one—that proscribe the Board from im-

posing terms and conditions in route certificates. In

urging that Section 401(e) (6)-embraces only off-route

charter operations, the Board presumably would retain

- to itself, as part of its power to issue route certificates

- under Section 401(d) or to modify certificates under

‘* Section 401(g), the authority to bar a route carrier

from conducting charters on-route. But no one—in-

cluding the Board—his evet suggested that it has such

authority. The Board could not, that is, delete from a.

route certificate the right to conduct on-route charters.

The reasormhowever, is nat that the Board is precluded

1 « intl a

trom doing i so by Sections 401(d) or 401(g) of the Act

but that Section 401(e) (6) withholds such power from

the Board: Section 401(e)(6) itself grants charter

authority to the route carriers and permits the Board

only to ‘‘regulate”’ the exercise of that authority. The

section is comparable in this respect to other portions

of Section 401(e) of the Act that limit the Board’s

authority to impose terms and conditions in certifi-

eates. See Section 401(e)(2) (transport of foreign

countries’ mail); 401(e)(4) (change of schedules,

equipment, facilities) (Appendix B, p. 5a below). So ~

construed, Section 401(e) (6) and the certificating pro-

_ visions of the Act fit together into a unified regulatory

scheme, .

2) Although no decisions under“ the Aviation Act

illuminate with clarity the ‘Meaning of Section 401

(e)(6),* a three-judge court in the Judicial Circuit

* Garly decisions of the Board indicated that it construed the

predecessor of Section 401(e)(6)—Section 401(f) of thefCivil

Aeronauties Act of 1938 (Appendix B, p. lla below) the

source of authority for charter services by the route carriers.

Western Air Corp.—Grandfather Certificates, 1 C.A.B. 39, 42

. (1939) ; Pioneer Air Lines, Ine., 7 C.A.B. 469 (1942). One district

court decision construing Section 401(f) stated that charter serv-

ices by route carriers are ‘‘an expressly declared right-granted, ©

not by action of the Board, but by law’’—that is, by Section 401(f)

itself. Pacific Northern Airlines v. Alaska Airlines, 80. Supp.

592, 603 (D. Alaska, _

The decision or the rt.of Appeals below more than a decade

ago in The Flying Tiger“Line Ine. v. Civil Aeronautics Board, 92

U.S. App. D.C. 260, 204 F.2d 404 (D.C. Cir: 1953), although also

involving the predecessor, of Section 401(e) (6), was not concerned

with whether the statutory provision embraced on-route as well as

off-route charter services. This earlier case is of relevance now

only because it clearly established that. Seetion 40i(f) did not

eneompass authority for passenger charters by the all-cargo car-

of the Court of Appeals below has interpreted the cor-

relative provision of the Motor Carrier Act (54 Stat.

919, 49 U.S.C. § 301 et seg.) as Petitioner urges Section °

401(e) (6) should be construed. Section 208(c) of the —

Motor. Carrier Act, like Section 401(e) (6), appears in

the portion of that regulatory. statute treating the

‘terms and conditions of certificate[s].’’ Section 208

(ce) authorizes any certificated motor carrier to trans-

port ‘‘to any place special or chartered parties under ©

such rules and regulations as the Commission shall

have prescribed” (Appendix B, p. lla: below). Safe-

way Trails, Inc. v. Interstate Commerce Commission,

176 F. Supp. 201, 204-05 (D.D.C. 1959), aff’d. per

curiam, 361 U.S. 86 (1960), construed Section 208 (¢)

to be the statutory authority for motor carrier charter

services under the Motor Carrier Act. In language

thet could be applied almost verbatim to the instant

proceeding, the court ruled that the section precluded

the Interstate Commercé Commission from imposing

restrictions on charter services when it issues a route

certificate to a motor carrier.

The Civil Aeronautics Act of 1938 1 was patterned

upon the Motor Carrier Act, which had been enacted

by Congress only three years earlier. Accordingly,

the clear meaning that has been ascribed to Section

- 208(c) is persuasive in any search for the’ proper in-

terpretation of Section 401(e) (6),.the direct analogue

for comparable charter authority in the Aviation Act.

riers. Whether the cargo carriers are entitled to perform passenger

charters was definitively settled with the passage of the 1962

Amendment that became Section 401(e)(6) and which contained _

the words ‘‘ without régard to. . . the type of service.’’? In dispute

now is the equally critical issue of how and the extent to which

eargo carriers shall be entitled to perform such charters; ie.,

whether the Board may cancel the statutory, right i in the guise. of

regulaticn.

3) Finally, the legislative history of the 1962 Amend-

ment to the Aviation Act that became Section 401

(e) (6) indicates that the intent of Congress in enacting

the'words ‘‘without regard to .. . the type of service’?

was to place cargo carriers on an equal footing with ~

- combination carriers in performing charters. Senator

Engle, the author of the 1962 Amendment, in a state-

ment to the Senate, declared that the Amendment was

intended to “‘give to the cargo carriers the. same au-

thority enjoyed by passenger carriers in providing

charter service of all types, no more and no less’’ (em-

phasis supplied). 108 Cong. Rec. 11426.* This state-

qjent was adopted: by Senator Monroney (ibid.), who

. was the floor leader in the Senate and who led the Sen-

ate conferees in the Committee of Conference which _

acted on the 1962 amendments for both houses of Con-

gress.

Senator Enigle subsequently wrote to the Board’s

Chairman-further elaborating the intent of his amend-

.ment with particular reference to the Board’s pro-

* The relevant portion of Senator Engle’s statement reads:

“‘ Against heavy odds, the cargo carriers are building an air

cargo industry ‘for the United States, without Government

subsidy. Their ability to develop this new business and to

_ create new fleets of modern aircraft has been made possible

in the main by their charter activities. Without. the amend-

ment. to Section 401(e) of the Federal Aviati@n Act which

is included in the bill before you, the cargo carriers would be

the only carriers who would not be permitted to perform both

cargo and passenger operations without applying to the CAB

for exemptions. This bill as reported by the committee of

conference will correct this situation and will give to the cargo

carriers the same authority enjoyed: by passenger carriers

_ in. providing charter services of all types, no more and no

less.’’? 108 Cong. Ree. 11426.

posed Part 207 regulation (J.A..69-74). He took

sharp issue with the Board’s reading of Section 401

(e)(6) as confined to off-route charters. The letter

expresses in simple and direct terms the deep concern

of the author of the 1962 Amendment that the admin-

istrative agency was preparing—as it finally did—to

use its authority to “regulate” charter service as a

‘means of withholding the passenger charter rights |

_ Congress intended the cargo carriers to have. In sum,

as Senator. Engle feated, the Board has employed its

on-route and off-route rationale to read back into See-

tion 401(e) (6) the very discrimination against the

cargo carriers that Congress sought to eliminate once

and for. all.*

* In the proceedings below, the Board has beerr hard put to show

that Section .401(e¢)(6) applies only to off-route charters. The

- Board has cited to a solitary: word and no more. That is the word

‘‘off-route,’? which was employed in passing and without exegesis

in the portion of the Conference Report treating the 1962 Amend-

ment. See H.R. Conf. Rep. No. 1950, 87th Cong. 2d Sess., p. 12.

The Board has also referred to a letter by Senator Cotton to the

Board’s Chairman (J.A. 103-04). This communication relies large-

ly on the language of the Conierence Report and does little more

than restate the Board’s own off-route and on-route rationale—

essentially as we have explained it above (p. 13).

There is no greater merit in the Board’s own additional re-

liance on the Conference Report in the proceedings below to estab-

_ lish that ‘Congress isitended to grant the Board discretion in

authorizing the cargo carriers to perform passenger charters. In

the face of the-clear language employed by Senator Engle and

embraced by Senator Monroney, the more persuasive view would

' appear to be that, whatever discretion the Board may have, it is

not a discretion to issue regulations governing charters that

grievously discriminate between the cargo carriers ‘and the com-

bination carriers. . ,

B. Part 207 so Restricts and Discriminates Against the All-

argo Carriers as to be Totally Destructive of the

Seelatery Rights to Perform Charter Services That

- Section 401(e)(6) Grants to Them.

This Court’s decisions have long established that an

administrative agency may not deny by rule or regula-

_ tion what Congress has conferred by statute: The

regulations of an agency issued pursuant to the statute

it administers must carry out the legislative purposes

of. Congress—and not amend, alter or modify those

_purposes as the agency sees fit. See Miller v. United

States, 294 U.S. 435 (1945) ; Manhattan General Equip-

ment Co. v. Commissioner of Internal Revenue, 297

U.S. 129 (1935) ; Federal Communications Commission

v. American Broadcasting Co., 347 U.S. 284 (1954);

Social Security Board v. -Nierotko, 327 U.S. 358

* (1945); Helvering v. Credit Alliance Corp., 316 U.S.

107 (1941); Lynch v. Tilden Produce Co., 265 U.S.

315 (1924); International Ry Co. v. Davidson, 257

U.S. 506 (1922).*

Decisions involving the Civil Aeronautics Board are

in accord. In Civil Aeronautics Board v. Delta Air

Lines, Inc., 367 U.S. 316; 322 (1961), the Court com”

mented that the Board is entirely ‘‘a creature of

*In Manhattan General Equipment Co., supra, the Court —

declared (297 U.S. at p. 134-35) :

‘*The power of an administrative officer or - board to admin-

ister a federal statute and to prescribe rules and regulations

to that end is not the power to make law, for no such power

can be delegated by Congress, but the power to adopt regula-.

tions to carry into effect the will of Congress as expressed by

the statute. A regulation which does not do this, but operates

to create a rule out of harmony with the statute, is a mere

nullity. ... And not only must a regulation, in order to be

valid, be consistent with the statute, but it must be reason-

able. .

Congress’”’ and the issue in any proceeding ‘‘is not

what the Board thinks, it should do but what Congress

has said it can do.’’ Cf. Civil Aeronautics Board v.

Summerfield, 347 U.S, 924 (1954).

‘Tt is 3s beyond any dispute here that Congress intone

to authorize, the route carriers to perform charter

services. It is equally beyond dispute that in the 1962

Amendment to the Aviation Act that became Section

riers’ existing right to perform cargo charters by add- *

ing the important further right to perform passenger

charters. The sharp dispute in the instant proceeding

is over whether the Board has blatantly thwarted these

clear legislative purposes by imposing regulations

which effectively destroy the charter rights Congress

intended the cargo carriers to have. ~ ~

Even brief analysis discloses that the Board’s Part

207 has not ‘regulated?’ the charter Operations of the

all-cargo carriers but has for all practical purposes

withdrawn their right to perform charters. The effect

of the Board’s 2% restriction on off-route charters by

. these carriers (which of course includes their on-route

passenger charters) is devastating. Applied to Peti-

tioner’s scheduled service. mileage of .approximately

5,000,000 miles in 1964, for example, the restriction

would preclude Petitioner from performing more than

about 100,000 miles of off-route charters in 1965 (J.A.

48). This. mileage—assuming it were all’ applied to

passenger charters—would confine Petitioner to one

and one-half round-trip coast-to-coast passenger char-

ter flights per month.* Such ‘‘regulation’’ will mean

_ This stark result was cited by dissenting -Member Gurney.

He concluded (J.A. 40): ‘‘In effect, this [2%] limitation will pre-

_ elude the all-cargo carriers from engaging in any passenger busi-

ness and for this reason [it] is an unreasonable restriction.”

21 .

that Petitioner cannot retain the bare minimum of

employees or services required for the performance of

passenger charters or utilize effectively even one air-

craft having the capability for passenger configuration

(J.A. 40). pone

Petitioner would fare no better with cargo charters

in international air transportation, the major market

for such services. Between the Pacific area and the

United States, for example, where charter flights of

ten thousand miles are common, the Board’s 2% re-

- striction would enable Petitioner, again using its 1964

scheduled service mileage figures, to perform less than

one charter (cargo or passenger) per month.*

_ These egregious results of the Board ’s effort to ‘‘pre-

scribe regulations’? pursuant to .Section 401(e) (6)

should not be permitted to stand. Certainly they are

not explained by the brief-remark of the District Court —

below. that: ‘‘Some mathematical: formula had to be

contrived in order to effectuate [the regulation ’s] aim.

The Board used its best judgment in devising one’’

(J.A. 111). In truth, such a ‘“‘best judgment’’ can be

understood only on one or both of two grounds: the

Board either had no real understanding of what dam-.

age it was. doing to the all-cargo carriers; or the Board

deliberately embarked on a course designed to with-

draw the statutory rights Section 401(é)(6) of the

*It is no solace to Petitioner and: two other all-cargo carriers _

that the Board’ authorized them to perform unrestricted cargo.

charters within the contiguous 48 states (J.A. 22). The facts of

life in the air cargo industry are that there’is no significant

market for cargo charters within the United States because the

nation is so completely served by scheduled cargo and combination

carrier routes. See Comments of Petitioner to the Board in the

Part 207 rule-making proceeding, March 9, 1964 (Tr. 649, 659-61).

Act granted to these carriers to perform charter serv-

ices.* In either case, the Board’s actions can be per-

mitted to go without further scrutiny by this Court

only at the considerable risk of undermining the eco-

nomic vitality of Petitioner and the other all-eargo

carriers. :

<h Winn Seseaiiicasiadiiai tls lea g Proceeding

No Information Whatscever That Could Sustain Its

Stated Basis agd Purpose for Promulgating Part 207.

American Trucking Associations v. United States,

344 U.S. 298 (1953), makes clear that the reasonable-

ness of an administrative ‘agency’s regulations are to

be tested on judicial review in the context of the in-

formation adduced in the agency’s rule-making pro-

*Nor can Part 207’s destruction of the charter rights of all-

cargo carriers be sustained as an ‘effort by the Board to protect

“the one class of carriers who were openly singled out for favor

‘in the rule-making proceeding—the supplemental carriers (J.A.

18-19)...A fair reading of the Board’s opinion indicates that a’

major concern of the Board was to carve out and secure the charter

market for the supplemental carriers. At one point, the Board -

stated that ‘‘the overriding consideration is the necessity of

preventing undue impairment of the opportunity of the supple-

mentals [earriers] to develop the charter market, ...’’ (J.A. 19).

_ In the face of the clear and indisputable purpose of Section

401(e)(6), to authorize the route carriers to conduct charter

operations, there is no basis in the Aviation Act. for such preferen-

‘tial treatment by the Board. The Board’s authority under Section

416(a) of the Act to create classes of carriets (Appendix B, p. 9a

below) does not in itself justify action-that withdraws statutory

rights from other classes of carriers. To accomplish this result

lawfully, the Board must rely upon other provisions of the Act

that authorize it to make substantive preferential distinctions

_ among carriers. Neither the courts below nor the Board have

‘eited any such independent sources of statutory authority. Surely,

the 1962 amendments to the Act—which first accorded the supple-

mental carriers certificate rights—do not sustain such a preference

- for this class of carriers to the detriment of other classes of carriers. -

a.”

* ceeding. In passing upon the lawfulness of trip leasing —

regulations issued by the Interstate Commerce Com-

mission under the Motor Carrier Act, the Court in.

American Trucking undertook to consider ‘‘the exist-

ing conditions of the motor truck industry and its regu-

lation as developed during the Commission’s hearings

meaningful’”’ (id. at p, 302). The Court accordingly

_ reviewed the information that had been developed in

the rule-making proceeding (id. at pp. 302-08), and

concluded that ‘‘the evidence marshalled before. the

Commission plainly supports the conclusion that the

continued effectiveness of its regulation requires the

rules prescribed” (id. at p. se :

Tested by the standard of American Trucking, Part

207 cannot tbe sustained“ The information ‘before the .

‘Board in the Part 207 rule-making proceeding was

plainly inadequate in light of the stated ‘“‘basis and

purpose’’ of the regulation. Part 207’s chief purpose,

assure that the certificated carriers do not place undue

emphasis op, charter operations in derogation of their

obligatioxi to perform adequate scheduled service.’’

Petitioner and the other route carriers might thus have

_ anticipated that the Board would adduce some infor-

.mation to substantiate that charter operations were,

at the very least, threatening to.interfere in some way

with the scheduled services of these carriers. Such

was not the case, however. Board Member Gilliland.

‘stated in dissent (J.A. 36): . [I]t is to be noted -

that instances of carrier neglect of their ‘ primary role’

have not been adverted to.”

The striking conclusion that emerges from careful |

~ study of the more than 1600 pages of comments and

o“

courts below was to no avai

+ ea

memoranda submitted in ‘the rule-making proceeding

is that the record is utterly barren of any information

suggesting that fhe ‘route carriers’ charter services

adversely affected their scheduled operations.”

Petitioner’s reliance ce“ ag Trucking in the :

The District Court, al-

though not referring to this Court’s decision and al-°

though its views on the instant question are unclear,

appeared to interpret Petitioner’s challenge to the

adequacy of the rule-making record before the Board

as.a claim that valid rule-making requires ‘‘evidenve

%: formally presented at hearings’”’ (J.A. 110).- Peti-

:. tioner made no such claim. Plainly, neither American

Trucking nor any other precedent requires such an

evidentiary hearing for a rule-making proceeding.

What is required is some reasoned, understandable

relationship between why an administrative agency

says it is issuing a regulation and the information

: underlying its decision to take such action. The grava-.

men of this aspect of Petitioner’s challenge to Part

207 is that no such relationship ‘ean be shown.

D. hin atk iia Gail Vi ihe Dials nih te :

‘No. 304 of this Term, Whether the Board May Deprive .

’ Air Carriers of Certificate Rights on the Basis of a Rule-

Making Proceeding in Lieu of the Adjudicatory Hearing

Section 401(g) of the Federal Aviation Act Requires.

The Court now has before it the petition for a writ

of certiorari to the Court of Appeals below filed in

American Airlines, et al. v. Civil Aeronautics Board,

No. 304, Naciee. Term, 1966 (commonly known as “‘the

* As wer (p. 2, n.*), the’ anol before the, Board was avail-

able to the courts below has been _ in this Court.

blocked space ee ‘The chief question ‘anise

by that petition, as we have noted ( (p. 10 fi bove), -

parallels i in significant respects the. remaining question

presented by this petition.’ That i is, whether the Board,

or any administrative agency, may act on the basis -

of a rule-making proceeding in lieu of an adjudicatory

hearing to deprive common carriers holding certificates.

of public convenience and necessity of — contained —

within their certificates. * 3

sion in the blocked space case disposed of the compar-

_ able question of administrative law and procedure pre-

sented in:this case.* Moreover, the sole authority cited

in the per curiam opinion of the court below in the

instant proceeding is that court’s en bane decision in

the blocked space case. And the District Court below

disposed of Petitioner’s claim to an adjudicatory hear- °

ing on essentially the same reasoning as that of the.

Court of Appeals in the blocked space case—that no

such hearing is required ‘‘if the impact’ of a ruling

° \

App. D.C., p. 39; Reply Brief for Appellant The Flying Tiger .

Line Inc., No. ‘19869, U.S. App. D. C., p. 11. Petitioner initially 7

* See Brief for the Civil Aeronautics Board, No. 19869, U.S:

“As

- Both Petitioner and the Board actetsiainii in the #

Court of Appeals below that the court’s en ‘bane dey

urged in its brief in chief in the ‘proceedings below, that the —

blocked space decision of a panel of the court below, subsequently

reversed by the court en banc, had-decided in Petitioner’ s favor

connection with the issuance of Part 207. Brief for Appellant The

Flying 7 Line Ine., No. 19869, US. App. D.C. rP. all

the question of whether.-an adjudicatory hearing was required in ~~

or decision of the Board-affects an entire class, rather

[than] particular members 9 a group” (J.A. 109).*

Accordingly, i in order to avoid burdening this Court

with a duplication of the reasons for granting the writ.

contained in the petition filed in the blocked space éasé,

Petitioner associates itself, for purposes of the ques-.

_ tion presented now under consideration, with the sub-

stance of the reasons set forth in that petition (at pp.

14-29) in support of the first question there presented.

The authorities cited in the blocked space petition are

equally compelling here. Petitioner respectfully re- _—

quests the Court to treat those authorities for purposes

of this case as if they are fully set forth herein. |

* Board Member Gilliland, dissenting, also treated the Board’s

blocked space ruling and its Part 207 determination as presenting

the same question of whether 8 an atjedientery he@ring. was required.

(J.A. 37-38): ; | age

“The Board cannot, in my judgment, legally jugele the

rights of carriers in such fashion without an adjudicatory

hearing. The ‘fact that Part 207 is labeled rule-making is

immaterial sinée it is well established that an agency may not

change an adjudicatory matter to a aera mnanated matter ‘by

the attachment of a label.

‘‘It appears to me that fhe Board has, as it did by the

* Issuance of Part 399, Blockbd-Space Service, August 7, 1964,

. attempted to delineate the roles of the combination .and the

- all-eargo earriers to such extent as to amend basic statutory

and eertificate rights without hearing. . The statute clearly

does not. permit such action. . . . Such action ean only be

taken under section 401(g) ‘after notice and hearing.’ ’’

. : 27 z ,

we a. CONCLUSION

For the foregoing reasons, the writ of certiorari

should issue. .

Respectfully submitted,

Myer FELDMAN b

ALVIN FRIEDMAN

One Farragut Square

és , South: :

ie. | _ Washington, D. C.20006 -

Attorneys for —

. Petitioner

_ Of Counsel: :

Meyers & Dryer

1201 Shoreham Building

Rosert M; #fausman

GinsBuRG & FetpDMAN

One Farragut Square South

Washington, D. 6. 20006

August 1966

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.