Opposition Brief — B. J. Alan Co. v. Interstate Commerce Commission

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Supreme LOourt, v.o

FILED

No. 91-1267 MAR 4 1922

- OTICE UF Tht CLERK

IN THE

Supreme Court of the United States

OCTOBER TERM, 1991

B.J. ALAN COMPANY, INC.,

OLDE GLORY MARKETING, LIMITED,

NEPTUNE FIREWORKS COMPANY, INC.

AND CONSIGNED SALES COMPANY, INC.,

m Petitioners,

INTERSTATE COMMERCE COMMISSION AND

UNITED STATES OF AMERICA,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the District of Columbia Circuit

BRIEF OF RESPONDENTS UNITED PARCEL SERVICE,

INC. (OH) AND UNITED PARCEL SERVICE, INC. (NY)

IN OPPOSITION

JAMES F.. MORIARTY

(Counsel of Record)

ROBERT L. KENDALL, JR.

JAMES D. CRAWFORD

SCHNADER, HARRISON, SEGAL

& LEWIS

1111 Nineteenth Street, N.W.

Suite 1000

Washington, D.C. 20036

Of Counsel: (202) 463-2978

EVERETT HUTCHINSON Attorneys for Respondents

FULBRIGHT & JAWORSKI United Parcel Service, Inc.

801 Pennsylvania Ave., N.W. (OH) and United Parcel

Washington, D.C. 20004 Service, Inc. (NY)

WILSON - EPES PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

QUESTION PRESENTED

Whether a federal agency abused its discretion in re-

fusing to reopen an administratively final decision that

the Court of Appeals had unanimously affirmed and that

the Supreme Court was then not asked to review, after

the Court issued a later opinion in a different case that

addressed a statutory provision not raised in the closed

proceeding?

ac lai

PARTIES TO THE PROCEEDINGS

The following entities were proper parties in the pro-

ceedings before the Court of Appeals below:

Interstate Commerce Commission

United States of America

B.J. Alan Company, Ine.

Olde Glory Marketing, Limited

Neptune Fireworks Company, Inc.

United Parcel Service, Inc. (an Ohio Corporation)

United Parcel Service, Inc. (a New York

Corporation }

Respondents United Parcel Service, Inc. (OH) and United

Parcel Service, Inc. (NY) are wholly owned subsidiaries

of United Parcel Service of America, Ine.

TABLE OF CONTENTS

QUESTION PRESENTED .............

PARTIES TO THE PROCEEDINGS

TABLE OF AUTHORITIES ......

OPINION BELOW

Pip i Oy yl 8),

STATUTES INVOLVED ..

COUNTERSTATEMENT OF THE CASE

REASONS FOR DENYING THE WRIT

CONCLUSION...

(iii)

Page

iw)

TABLE OF AUTHORITIES

Cases: Page

B.J. Alan Co., Inc. v. 1.C.C., 897 F.2d 561 (D.C.

i 7.) Renal she ea 2,6

B.J. Alan Co. v. United Parcel Service, 5 1.C.C. 2d

700 (1989) et ee eee 2,3

B.J. Alan Co., Inc. v. Interstate Commerce Com-

mission, 110 S. Ct. 29 (1989) (mem.) __....... 3

In re: United Parcel Service, Inc., 839 F.2d 1195

(6th Cir. 1988) SA Peek See Ae Noe PM oA crnalhs 2

Bowman Transportation Co. wv. Arkansas-Best

Freight System, Inc., 419 U.S. 281 (1974) 8

1.C.C. v. Brotherhood of Locomotive Engineers,

482 U.S. 270 (1987) Pot eee ee 7

Maislin Industries, U.S. v. Primary Steel, Inc., 110

S. Ct. 2759 (1990) .... Seas ae pons ea 3, 5, 6, 7

Pennsylvania Railroad Co. v. Puritan Coal Mining

Co., 237 U.S. 121 (1914) 6

Square D. Co. v. Niagara Frontier Tariff Bureau,

Inc., 476 U.S. 409 (1986) 7

United States v. Utah Construction Co., 384 U.S.

394 (1966) . Na LS 8

Statutes and Regulations:

Interstate Commerce Act, 24 Stat. 383, as amended,

49 U.S.C. § 11101........ ey 3, 6,7

IN THE

Supreme Court of the United Siates

OCTOBER TERM, 1991

No. 91-1267

B.J. ALAN COMPANY, INC.,

OLDE GLORY MARKETING, LIMITED,

NEPTUNE FIREWORKS COMPANY, INC.

AND CONSIGNED SALES COMPANY, INC.,

2 Petitioners,

INTERSTATE COMMERCE COMMISSION AND

UNITED STATES OF AMERICA,

cespondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the District of Columbia Circuit

BRIEF OF RESPONDENTS UNITED PARCEL SERVICE,

INC. (OH) AND UNITED PARCEL SERVICE, INC. (NY)

IN OPPOSITION

OPINION BELOW

The unreported per curiam opinion of the United States

Court of Appeals for the District of Columbia Circuit is

reprinted in Appendix A to the petition at la-5a, cited

herein as “—a.” The unreported decisions of the Inter-

state Commerce Commission (“ICC” or “Commission’’)

denying petitions to reopen an administratively final deci-

sion are reprinted in Appendix A to petition at 8a-25a.

JURISDICTION

The jurisdictional requisites are adequately set forth

in the petition at p. 2.

STATUTES INVOLVED

The statutes involved are largely set forth in the peti-

tion at pp. 2-8. In addition, Section 10327(g) (1) of

Title 49 of the United States Codes, 92 Stat. 1348, pro-

vides, as herein pertinent:

The Commission may, at any time on its own initiative

because of material error, new evidence, or substantially

changed circumstances—

(A) reopen a proceeding

COUNTERSTATEMENT OF THE CASE

The genesis of this dispute occurred in 1987 when UPS

published a tariff item with the Interstate Commerce

Commission discontinuing the transportation of explosive

fireworks. The Commission fully considered and denied a

petition by the fireworks shippers to suspend and investi-

gate the tariff, which became effective on January 1,

1988.' After extensive discovery, briefing and arguments,

the Commission found in 1989 that UPS did not violate

its statutory common carrier obligation, which requires

a motor carrier to provide service only upon “reason-

able request”. B.J. Alan Co. v. United Parcel Service,

5 1.C.C. 2d 700 (1989) (App. D to petition at 26a-60a).

In 1990, the United States Court of Appeals for the

District of Columbia Circuit unanimously affirmed the

ICC’s decision, finding that the Commission had properly

interpreted its organic statute and that substantial evi-

dence supported the factual findings made. B.J. Alan Co.,

Ince. v. 1.C.C., 897 F.2d 561 (D.C. Cir 1990) The Court

of Appeals cited with approval the Commission’s conclu-

sion that “even in the earliest rail cases, the obligation

to provide service was not held to be absolute, but rather

1The United States Court of Appeals for the Sixth Circuit

rejected the fireworks shippers’ attempt to stay the Commission’s

decision not to suspend UPS’s tariff item. Jn re United Parcel

Service, Inc., 839 F.2d 1195 (6th Cir. 1988).

was qualified by a rule of reason[.]” Jd. at 564. The

Court of Appeals then concluded, as had the Commission,

that the transportation conditions attendant to fireworks

are dramatically dissimilar from those applicabie to other

small packages, in that they require specialized handling

and result in substantially increased costs, justifying

UPS’s discontinuance of service. Discontinuance is espe-

cially appropriate since other carriers were available to,

and had actually been used extensively by, Petitioners.

Id., 5 1.C.C. 2d at 704. (Appendix D to petition at 28a,

46a, 48a).

Since the 1990 D.C. Circuit affirmance of the Commis-

sion, Petitioners filed twelve pleadings with the ICC seek-

ing to reopen the administratively final decision.* The

Commission fully considered and denied each reopening

request. Docket No. MC-C-30093, B.J. Alan Co., et al. v.

United Parcel Service, Inc., et al. (not printed), served

June 18, 1990 and April 12, 1991. (App. B and C to

petition at 8a-25a).

On the question of the applicability of the Court’s de-

cision in Maislin Industries, U.S. v. Primary Steel, Inc.,

110 S. Ct. 2759 (1990), which Petitioners raise here, the

Commission properly found that, unlike the filed rate

doctrine,

the common carrier obligation never has been abso-

lute, since it is tempered by a reasonableness deter-

mination. 49 U.S.C. § 11101(a) requires only that a

2 Petitioners have also sought, and been denied, relief in this

Court on three separate occasions. On August 21, 1989, Petitioners

filed an application for stay with the Court pending appellate re-

view, which the Chief Justice denied by letter dated August 22,

1989. On August 24, 1989, Petitioners filed a second application

for stay with Justice Brennan, which the Court denied on August

30, 1989. B. J. Alan Co., Inc. v. Interstate Commerce Commission,

110 S. Ct. 29 (1989) (mem.). On May 23, 1990, Petitioners peti-

tioned the Court for an extension of time to file a petition for writ

of certiorari to the D.C. Circuit on its 1990 affirmance of the

Commission. The Court denied that request and no writ was filed

by Petitioners.

carrier provide a service upon reasonable request . . .

|D]ue to the difficulties, both operational and legal,

that UPS has associated with the transportation of

common fireworks, UPS can regard requests to trans-

port fireworks as unreasonable and elect not to trans-

port them.

Docket No. MC-C-30093, B./. Alan Co., et al., (not

printed), served April 12, 1991. (App. B at 12a). The

Court of Appeals agreed, finding Petitioners’ claim “un-

reviewable or meritless” and concluding in a per curiam

opinion that “Maislin does not... represent a change in

the law governing the present case.” (App. A at 3a).

Petitioners seek review of the summary affirmance by

the Court of Appeals of the Commission’s refusal to re-

open its 1989 decision in this matter.

REASONS FOR DENYING THE WRIT

1. Petitioners have not advanced any legitimate basis

for the Court to grant certiorari. They have not identi-

fied, and there does not exist, any conflict among the

Circuits or any far-reaching legal question requiring reso-

lution by this Court. Indeed, the Petition is not from the

1990 decision of the Court of Appeals on the merits of

the dispute, but rather from the lower court’s summary

affirmance of the Commission’s refusal to reopen that pro-

ceeding over two years after it became final. Appropri-

ately, the Court of Appeals for the District of Columbia

Circuit concluded that this case merited only a _ per

curiam memorandum opinion. Clearly, the Petition is

frivolous and not worthy of review.

2. Petitioners have not contended, nor could they con-

tend, that the circumstances triggering this litigation

have occurred or are likely to occur with any frequency.

As is evident from the foregoing counter statement of the

case, this case involves a unique set of circumstances: a

group of shippers that were unwilling or unable to com-

ply with local and state regulations rendering the car-

rier’s continued transportation of explosive fireworks

operationally and economically impracticable. None of

the cases cited by Petitioners is remotely similar to the

case at bar.

3. The basic substantive argument underlying the Pe-

tition is that, in Petitioners’ view, the Interstate Com-

merce Commission and the Court of Appeals since 1987

committed error in failing to rule in their favor. This

argument is wrong, is out of time, and in any event is

insufficient to justify a grant of certiorari. It is well

settled that this Court does not grant certiorari merely

to give a litigant another chance at appellate review. Sce

Supreme Court Rule 10. This rule is controlling here

where Petitioners have flooded the Commission and the

courts with meritless pleadings.

4. Petitioners rely solely on the Court’s decision in

Maislin Industries, U.S. v. Primary Steel, Inc., 110 S.

Ct. 2759 (1990), as requiring reopening of an adminis-

tratively final decision. Far from the panacea claimed by

Petitioners, the Court in Maislin held, in a narrow de-

cision where the negotiated rate had not been filed, that

a shipper must pay a carrier its filed tariff rate. In so

doing, the Court reaffirmed a long line of decisions where

it rejected exceptions to the strict application of the filed

rate doctrine and held that the Commission cannot rely

on policy initiatives to contravene a clear statutory direc-

tive.

a. The Court’s overriding concern in Maislin was that

the negotiated rate, which the shipper sought to enforce,

had never been filed with, and thus was never found just

and reasonable by, the Commission. Maislin, 110 S. Ct.

2761, 2766. In this proceeding, the opposite occurred.

UPS filed its tariff item with the Commission and, fol-

lowing protests and complaints by fireworks shippers, the

ICC, after lengthy deliberations and careful considera-

tion, found the item lawful. Moreover, the Court of

Appeals specifically reviewed the filed tariff item and

unanimously affirmed the ICC’s decision. Therefore, no

comparison with Maislin is apppropriate or availing.

b. Unlike the Supreme Court’s interpretation of the

filed rate doctrine, the common carrier obligation of a

motor carrier, which is at issue here, is not absolute.

Under the statute, “|a] common carrier providing trans-

portation or service subject to the jurisdiction of the

Interstate Commerce Act ... shall provide the transpor-

tation or service on reasonable request.” 49 U.S.C.

$11101(a). As the Commission explained,

The Interstate Commerce Act, 49 U.S.C. § 11101, re-

quires that a common carrier providing service sub-

ject to the Commission’s jurisdiction shall previde

such service upon reasonable request.

5 1.C.C, 2d at 710 (emphasis added) (App. D to petition

at 40a). Unlike its filed rate decisions, the Court early

on held that the common carrier obligation is not abso-

lute; rather “the law exacts only what is reasonable from

such carriers.” Pennsylvania Railroad Co. v. Puritan

Coal Mining Co., 287 U.S. 121, 183 (1914). Based on

that rule, the Commission found that “the obligation to

provide service was not held to be absolute, but rather was

qualified by a rule of reason that excused carriers from

service failures that were reasonable under the prevailing

circumstances.” 5 I.C.C. 2d at 711. (App. D to petition

at 41a). Consistent therewith, the Court of Appeals spe-

cifically noted that “|a|n unlimited duty of carriage was

never the rule.” B.J. Alan Co., Inc. v. 1.C.C., 897 F.2d

561, 564 n.8 (D.C. Cir. 1996) (emphasis added). The

distinction here from the strict application of the filed

rate doctrine recognized in Matslin could not be more

striking.

ec. Contrary to Petitioners’ arguments, the Commis-

sion correctly considered the Motor Carrier Act of 1980

in determining the reasonableness of UPS’s actions. In

Maislin, the Supreme Court noted that the developments

prompting passage of the Act could not be used to con-

tradict the clear terms of the statute which did not attach

any reasonableness qualifier to the field rate doctrine.

Maislin, 110 8. Ct. at 2770. However, no contradiction

between the governing statute and the Commission’s ac-

tion is present here since the plain wording of the act

requires that both the shipper’s request, and the carrier’s

actions, be reasonable. 49 U.S.C. § 11101.

d. Petitioners rely inappropriately on two decisions

where the Commission found that Maislin constituted a

changed circumstance justifying the reopening of an ICC

decision.* Petitioners fail to mention, however, that those

two proceedings concerned the identical issue presented

in Maislin, i.e... whether in the undercharge context, a

carrier should collect the filed tariff rate. These decisions

have no applicability here where the issue is not the filed

rate doctrine, but whether a carrier need provide an

operationally and economically impracticable service.

5. Petitioners attempt to distinguish /.C.C. v. Brother-

hood of Locomotive Engineers, 482 U.S. 270, 280 (1987),

where the Court found that when, as here, a party peti-

tions for reopening of an earlier decision, an order deny-

ing that request is not reviewable. Petitioners’ argument

rests on two false assumptions: (i) that Maislin reversed

the legal analysis of the ICC and the Court of Appeals

as to the common carrier obligation and (ii) that the ICC

and the Court of Appeals violated longstanding Supreme

Court precedent. As already explained, this is not the

case since the Commission and the lower court correctly

applied relevant Supreme Court precedent. Similarly, Pe-

titioners cannot distinguish the Court’s holding in Square

D. Co. v. Niagara Frontier Tariff Bureau, Inc., 476 U.S.

409, 422 (1986), where, as here, “Petitioners have

pointed to no specific statutory provision or legislative his-

3 Petition at 7, citing Eastman Kodak Company—Petition for

Declaratory Order—Certain Rates and Practices of Advance United

Expressways, Inc., ICC Docket No. 40233 (July 8, 1991), General

Binding Corporation—Petition for Declaratory Order—Certain

Rates and Practices of Advance-United Expressways, Inc., ICC

Docket No. 40398 (July 12, 1991), both reprinted in Appendix F

to petition at 84a-9%a.

tory indicating a specific congressional intention to over-

turn” the Court’s longstanding interpretation of the com-

mon carrier obligation. Therefore, the Court should deny

the petition.

6. Petitioners did not seek Supreme Court review of

the 1990 unanimous affirmance by the Court of Appeals

of the Commission’s 1989 decision in this matter. Rather,

Petitioners tiled numerous reopening requests with the

Commission, all of which the agency rejected. As the

Court has explained, with equal application here, if “‘liti-

gants might demand rehearings as a matter of law

because some new circumstance has arisen .. . there

would be little hope that the administrative process could

ever be consummated.” Bowman Transportation Co. v.

Arkansas-Best Freight System, Inc., 419 U.S. 281, 294-95

(1974), citing, ICC v. Jersey City, 322 U.S. 503 (1944).

Accord, United States v. Utah Construction Co., 384 U.S.

394, 422 (1966). On that basis alone, the Court should

deny the petition.

CONCLUSION

For the foregoing reasons, this Court should deny the

petition for a writ of certiorari to review the decision of

the United States Court of Appeals for the District of

Columbia Circuit.

Respectfully submitted,