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BURLINGTON TRUCK LINES, INC. v. I.C.C.

April 27, 1961

BURLINGTON TRUCK LINES, INC., A CORPORATION, PLAINTIFF,
v.
INTERSTATE COMMERCE COMMISSION AND UNITED STATES OF AMERICA, DEFENDANTS, AND SANTA FE TRAIL TRANSPORTATION COMPANY ET AL., PLAINTIFFS-INTERVENERS.



Before Major, Circuit Judge, Mercer, Chief Judge, and Poos, District Judge.

The opinion of the court was delivered by: Poos, District Judge.

  Burlington Truck Lines, Inc., a corporation, plaintiff, filed its complaint seeking injunctive relief against Interstate Commerce Commission and the United States to restrain the enforcement of the orders of Interstate Commerce Commission granting a limited certificate of convenience and necessity to Nebraska Short Line Carriers, Inc., in the Commission proceedings entitled, "Nebraska Short Line Carriers, Inc., Common Carrier Application, Docket No. MC-116067."

Jurisdiction is authorized by Title 28 U.S.C. § 1336, 1398, 2284, and 2321 through 2325, inclusive, all of which authorize interested parties to seek relief from a three-judge United States District Court.

The intervening plaintiffs are Santa Fe Trail Transportation Company, Watson Bros. Transportation Co., Inc., Red Ball Transfer Co., Interstate Motor Freight System, Inc., Independent Truckers, Inc., Illinois-California Express, Inc., Interstate Motor Lines, Inc., Navajo Freight Lines, Inc., Ringsby Truck Lines, Inc., and General Drivers and Helpers Union, Local 554, affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America. The effect of the pleadings of interveners is to adopt the allegations and theory of the plaintiff's complaint.

Plaintiff, and all interveners, except the labor union, are common carriers by motor vehicle in interstate commerce and subject to the Interstate Commerce Act. Plaintiff is authorized to engage in transportation of general commodities to, from and between points in Colorado, Illinois, Indiana, Iowa, Kansas, Missouri, Montana, Nebraska and Wyoming, pursuant to a "Certificate of Public Convenience and Necessity," issued to it by the Interstate Commerce Commission. Its residence and principal offices are located in Galesburg, Knox County, Illinois. Watson Bros. Transportation Company, Inc., The Red Ball Transfer Co., Interstate Motor Freight System, Inc., Independent Truckers, Inc., Illinois-California Express, Inc., Interstate Motor Lines, Inc., Navajo Freight Lines, Inc., and Ringsby Truck Lines, Inc., are likewise common carriers and are authorized to do business by virtue of "Certificates of Convenience and Necessity," issued by Interstate Commerce Commission to them in various proceedings and orders of the Commission. Their operations cover the States of Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Massachusetts, Maryland, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Texas, Utah, Virginia, West Virginia, Wisconsin and Wyoming, and the various business offices of these motor carriers are located at Denver, Colorado, Grand Rapids, Michigan, Omaha, Nebraska, and Salt Lake City, Utah. The application of Nebraska Short Line Carriers was opposed before the Commission by eighteen motor and rail carriers, and the intervening plaintiffs were included. All class rail carriers in western trunkline territory likewise opposed the application, as did the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America and Local No. 554 thereof.

The complaint alleges that Nebraska Short Line Carriers, Inc., by application filed June 22, 1956, Docket No. MC-116067, sought authority from the Commission to conduct operations as a common carrier in interstate and foreign commerce in the transportation of general commodities, with certain exceptions over irregular routes, between Denver, Colorado and Chicago, Illinois; between Omaha, Nebraska and Chicago, Illinois; between Minneapolis, Minnesota and Des Moines, Iowa; between Council Bluffs, Iowa and St. Louis, Missouri; and between Lincoln, Nebraska and St. Joseph, Missouri, serving intermediate and off route points on said routes; and that by application filed January 10, 1957, Docket No. MC-116067, (Sub-No. 2), sought authority to operate as a common interstate and foreign motor carrier in the transportation of general commodities, with certain exceptions over irregular routes between Omaha, Nebraska, on the one hand, and, on the other, points in Arizona, Arkansas, California, Colorado, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nevada, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Utah, Washington, Wisconsin and Wyoming; that in Case No. MC-116067, the hearing examiner by proposed order served September 3, 1957, recommended to the Commission that the application be denied because Nebraska Short Line Carriers had failed to prove public convenience and necessity, and for the same reason by proposed order served August 8, 1957, in Case No. MC-116067, (Sub-No. 2) recommended that the application be denied; the Commission by order dated June 1, 1959 consolidated both cases and granted authority to applicant to operate as a common carrier by motor vehicle in the transportation of general commodities with certain exceptions over regular route between Omaha, Nebraska and Chicago, Illinois, and between Omaha, Nebraska, and St. Louis, Missouri, serving the intermediate points of Kansas City, Missouri, restricted in each instance to traffic originating at or destined to points in Nebraska, but denied the other application for additional rights; that by order dated March 10, 1960, the Commission denied the petitions for reconsideration and/or further hearing as filed by certain protesting carriers including the petition for reconsideration of plaintiff filed on July 27, 1959; and the complaint further alleges that the decision of the Commission is contrary to law for the same fourteen reasons, which, on analysis, challenge the jurisdiction of the Interstate Commerce Commission to enter the order in question under the law and the evidence.

The relief prayed is for entry of a decree adjudging the orders of Interstate Commerce Commission entered June 1, 1959, and March 10, 1960, to have been entered in violation of the Interstate Commerce Act, and therefore unlawful, null and void, and for such other relief as the court deems meet. The intervening motor carriers adopted the allegations of the complaint. Intervening plaintiff, The General Drivers and Helpers Union, Local 554, allege substantially the same matters as plaintiff, and alleged in addition that the basis for the application of Nebraska Short Line Carriers, Inc., was a desire to protect itself from the so-called "hot-cargo clause" provision of the labor contract entered into by the Union, plaintiff and intervening plaintiffs' carriers.

The defendants and intervening defendant, Nebraska Short Line Carriers, Inc., filed answers to the complaint, intervening carriers' complaints, and to the intervening complaint of Local 554, in and by which all factual allegations were denied and refer to and adopt the record of Interstate Commerce Commission for the complete and accurate facts and findings made by the Commission. They admit that the Commission does not have jurisdiction to consider the legality or propriety of agreements between motor carriers and labor organizations affecting labor relations between employers and employees, or to adjudicate labor disputes or controversies, but allege that the Commission, under the provisions of the Interstate Commerce Act, is concerned with, and has jurisdiction over the actions of common carriers in relation to their obligations to the public under said Act, and where, as here, the existing carriers are shown to have so conducted their operations as to result in serious inadequacies in the service available to a large section of the public, the Commission is empowered and charged with the duty of procuring such additional facilities by the grant of motor carrier authority as may be necessary to carry out the purposes of the National transportation policy; and admit that the Interstate Commerce Act does not contemplate or provide for issue of certificates of public convenience and necessity as a penalty, but say that the Act does provide for the issuances of certificates when the Commission finds that the service is, or will be required by the present or future convenience and necessity as provided in the Act; and further allege that the evidence adduced before the Commission, and here under review, established that the present and future convenience and necessity required operation by the applicant of a common motor carrier service between the points and to the extent set forth by the order of the Commission entered in this proceedings; refer the court to the Commission's report and order of June 1, 1959, for the complete and accurate reasons and basis for the grant of the certificate in question; and lastly, they say that the challenged orders of the Commission are lawful and in all respects valid and seek a decree that the relief prayed be denied, and the complaint and intervening complaints be dismissed.

All parties hereto agree to the findings of fact, one side of the litigants affirming these facts as justifying the orders, while the other deny that they do.

We are thus required to examine the facts and inquire, under those facts, whether or not there are substantial facts to either affirm or reject the respective orders under the applicable rules of law pertaining thereto.

The allegations of the complaint on which the plaintiff bases its right to relief, all adopted by the intervening plaintiffs, while stated in some fourteen allegations, when analyzed can be stated as based on one general proposition, namely, the questioned authority of the Commission to issue the Certificate granted under the Commission's statutory power. All other asserted propositions are urged as a basis for the denial of this power.

We are presented at the outset with the scope of judicial review of orders of the Interstate Commerce Commission. The Supreme Court, in a long line of decisions, has consistently held that orders of the Commission should not be set aside, modified or disturbed by a court on review, if they lie within the scope of the Commission's statutory authority, and are based upon adequate findings and are supported by substantial evidence, even though the court might reach a different conclusion on the facts presented.

This principle is clearly enunciated in Interstate Commerce Commission v. Union Pacific R.R. Co., 222 U.S. 541, 547-548, 32 S.Ct. 108, 110, 56 L.Ed. 308, 311, wherein the Court said:

    "There has been no attempt to make an exhaustive
  statement of the principle involved, but in cases
  thus far decided, it has been settled that the orders
  of the Commission are final unless (1) beyond the
  power which it could constitutionally exercise; or
  (2) beyond its statutory power; or (3) based upon a
  mistake of law. But questions of fact may be involved
  in the determination of questions of law, so that an
  order, regular on its face, may be set aside if it
  appears that (4) the rate is so low as to be
  confiscatory and in violation of the constitutional
  prohibition against taking property without due
  process of law; or (5) if the Commission acted so
  arbitrarily and unjustly as to fix rates contrary to
  evidence, or without evidence to support it; or (6)
  if the authority therein involved has been exercised
  in such an unreasonable manner as to cause it to be
  within the elementary rule that the substance, and
  not the shadow determines the validity of the
  exercise of the power (citing cases).
    "In determining these mixed questions of law and
  fact, the court confines itself to the ultimate
  question as to whether the Commission acted within
  its power. It will not consider the expediency or
  wisdom of the order, or whether, on like testimony,
  it would have made a similar ruling. `The findings of
  the Commission are made by law prima facie true, and
  this court has ascribed to them the strength due to
  the judgments of a tribunal appointed by law and
  informed by experience.' Ill. Cent. [R. Co.] v.
  I.C.C., 206 U.S. 441 [27 S.Ct. 700, 51 L.Ed. 1128].
  Its conclusion, of course, is subject to review, but
  when supported by evidence, is accepted as final; not
  that its decision, involving, as it does, so many and
  such vast public interests, can be supported by a
  mere scintilla of proof, but the courts will not
  examine the facts further than to determine whether
  there was substantial evidence to sustain the order."

The general rule is that "The judicial function is exhausted when there is found to be a rational basis for the conclusions approved by the administrative body." Mississippi Valley Barge Line Co. v. United States, 292 U.S. 282, 286-287, 54 S.Ct. 692, 694, 78 L.Ed. 1260; Rochester Telephone Corporation v. United States, 307 U.S. 125, 146, 59 S.Ct. 754, 83 L.Ed. 1147. The Commission's judgment is to be exercised in the light of each individual case. The courts are not concerned with the correctness of the Commission's reasoning or with the consistency or inconsistency of decisions which it has rendered. Virginian Ry. Co. v. United States, 272 U.S. 658, 663-666, 47 S.Ct. 222, 71 L.Ed. 463; Western Paper Makers' Chemical Co. v. United States, 271 U.S. 268, 271, 46 S.Ct. 500, 70 L.Ed. 941.

In Virginian Ry. Co. v. United States, 272 U.S. 658, at pages 665-666, 47 S.Ct. 222, at page 225, the court said:

    "* * * This court has no concern with the
  correctness of the Commission's reasoning, with the
  soundness of its conclusions, or with the alleged
  inconsistency with findings made in other proceedings
  before it."

Unless there is clear evidence to the contrary, it must be presumed that the Commission has properly performed its official duties; and this presumption supports its official acts. United States v. Chemical Foundation, 272 U.S. 1, 47 S.Ct. 1, 71 L.Ed. 131; Baltimore & Ohio Railroad Co. v. United States, 298 U.S. 349, 56 S.Ct. 797, 80 L.Ed. 1209; Federal Power Commission v. Hope Natural Gas Co., 320 U.S. 591, 602, 64 S.Ct. 281, 88 L.Ed. 333.

The National Transportation Policy of Sept. 18, 1940 (49 U.S.C.A. preceding Sections 1, 301, 901, and 1001), provides:

    "It is hereby declared to be the national
  transportation policy of the Congress to provide for
  fair and impartial regulation of all modes of
  transportation subject to the provisions of this Act,
  so administered as to recognize and preserve, the
  inherent advantages of each; to promote safe,
  adequate, economical, and efficient service and
  foster sound economic conditions in transportation
  and among the several carriers; to encourage the
  establishment and maintenance of reasonable charges
  for transportation services, without unjust
  discriminations, undue preferences, or advantages, or
  unfair or destructive competitive practices; to
  cooperate with the several States and the duly
  authorized officials thereof; and to encourage fair
  wages and equitable working conditions; — all to the
  end of developing, co-ordinating and preserving a
  national transportation system by water, highway, and
  rail, as well as other means, adequate to meet the
  needs of the commerce of the United States, of the
  Postal Service, and of the national defense. All of
  the provisions of this Act shall be administered and
  enforced with a view to carrying out the above
  declaration of policy."

Section 207(a) of the Interstate Commerce Act (49 U.S.C.A. § 307(a) provides in part as follows:

    "Subject to section 210, a certificate shall be
  issued to any qualified applicant therefor,
  authorizing the whole or any part of the operations
  covered by the application, if it is found that the
  applicant is fit, willing, and able properly to
  perform the service proposed and to conform to the
  provisions of this part and the requirements, rules,
  and regulations of the Commission thereunder, and
  that the proposed service, to the extent to be
  authorized by the certificate, is or will be required
  by the present or future public convenience and
  necessity; otherwise such application shall be
  denied * * * "

The admitted facts establish that Nebraska Short Line Carriers, Inc., is a corporation organized under Nebraska law on June 14, 1956, with authority to issue 1,000 shares of common and 500 shares of preferred stock at $100 per share; that at hearing time $37,500 of common stock had been issued and held in varying amounts by Romans Motor Freight and other Nebraska intrastate carriers, the officers and owners of which were experienced men and companies in the transportation business of motor common carriers, and all of whom had certificates of convenience and necessity, either from the Nebraska State Railway Commission for intrastate Commerce or from Interstate Commerce Commission for interstate traffic movements. All carriers and individual owners holding stock in Nebraska Short Line Carriers, Inc., are non-union motor carriers and operate wholly within certain points in Nebraska. The Nebraska Intrastate carriers are Romans Motor Freight, Clark Bros. Transfer, Lyon Transfer, McKay Freight Line, Winter Bros., Abler Transfer, Inc., Fremont Express Co., Superior Transfer, Pawnee Transfer, Derickson Transfer, Steffy's Transfer, Crete and Wilber Freight Lines, and Tillman Transfer Company. The President of applicant is John Romans, the Vice-President is C.C. McKay, the Secretary, Walter F. Clark, and the Treasurer, Royal F. Lyon, and who, with Leonard Abler, constitute the Board of Directors. Most of the stockholding truckers are authorized to transport general commodities with exceptions between certain points in eastern and central Nebraska, including Omaha and Lincoln, and between Grand Island and North Platte. Collectively they operate numerous vehicles, some of which are suitable for transporting commodities requiring refrigeration. The traffic manager was able to secure terminal facilities at Chicago, St. Louis, Kansas City, Minneapolis and Denver, and found that drivers and plenty of motor vehicles could be procured for the transportation of dry and refrigerated freight. Initially, applicant proposes to lease equipment from its stockholders or other motor carriers. The applicant, if granted authority, proposes to serve the public generally and its general manager indicated that no discrimination would be shown in selecting carriers for traffic interchange.

On January 26, 1957, applicant had total assets of $32,785; liabilities of $467; and net worth of $32,318. By order entered Dec. 4, 1956, temporary authority to applicant was approved upon meeting certain requirements.

In May, 1956, the stockholders, under their carrier rights, began to experience difficulties at Omaha, Lincoln and Grand Island, Nebraska, in respect to interstate traffic normally interchanged at those points with certain motor carriers. Romans was informed in Omaha, by an official of Independent, that the latter carrier was risking labor trouble with its employees, who are members of Teamsters' Union, if normal interchange between these carriers was continued, and it did not desire to handle freight moving from or to Romans' line. Certain shipments tendered by Romans to Watson at Omaha on May 10, 1956, were not accepted by that carrier. These shipments were accepted finally by Independent. Although Independent occasionally takes shipments from Romans, it did not do so in every instance. Romans is not given any traffic by Independent destined to the points he serves. Similar interchange difficulty has been experienced at Grand Island, particularly with Red Ball and Watson. Time is consumed in finding motor carriers willing to accept traffic, and Romans' operations are otherwise disrupted by an abnormal number of requests from consignors to trace shipments.

Certain motor carriers, particularly Burlington and Santa Fe Trail, continue to interchange freight with Romans whenever shipments are tendered. Romans has through rates with Burlington to all points in the application, and had this arrangement prior to May 7, 1956. Tenders of interstate shipments are made particularly to motor carriers other than Burlington and Santa Fe Trail to determine whether normal interchange has been resumed. Burlington has requested some shippers to route their traffic via Burlington and his line. He has interchanged freight on certain occasions with Rock Island Motor, apparently without incident.

Romans' volume of interline interstate freight decreased in 1956 compared to 1955 volume. His gross revenue in 1956 was $138,775, as against $159,280 in 1955. Prior to May, 1956, 30 per cent of his traffic consisted of outbound shipments, and 70 per cent was inbound. Presently most of his traffic consists of shipments moving out of the territory he serves, and over half the outbound shipments are routed.

Prior to May 7, 1956, Romans interchanged freight in Omaha with Brady, Burlington, Freightways, Independent, Prucka, taken over by Interstate Motor Freight System, Inc., Red Ball, Ringsby, Santa Fe Trail, Watson, Burlington-Chicago Cartage, Inc., Des Moines Transportation Company, Inc., Haeckl Express, Inc., Ideal Truck Line, Iowa-Nebraska Transportation Company, Inc., McMaken Transportation Company, Merchants Motor Freight, Inc., Revell Transit Lines, Roberts Transfer, Sturm Freightways, Trans-American Freight Lines, Inc., Wilson Freight Forwarding Company, Wright Motor Freight Lines, now B-C Cartage, D.M.T., Haeckl, Ideal I.N.T., McMaken, Merchants, Revell, Roberts, Sturm, Trans-American, Wilson and Wright, respectively. These were most of the major motor carriers with whom interchange was affected. After the approximate date of May 7, 1956, these truck lines would not tender or accept freight from Romans at certain times, and this has continued. Interchange between Romans and Burlington, Santa Fe Trail and Rock Island has continued. Ringsby has also accepted freight.

Romans is non-union. There have been no strikes by his employees, nor have any pickets been placed at his docks or terminals.

Abler's main office and terminal is located at Norfolk, Nebraska. It serves Sioux City, Iowa, as well as Omaha. No terminal facilities have been operated by this carrier at Sioux City since March 15, 1956, when certain unionized connecting carriers serving that point discontinued normal interchange operations with him. Shortly thereafter the discontinuance of normal interchange began at Omaha by most of the carriers with whom he interlined freight. Burlington and Santa Fe continued to interchange traffic and some shipments have been received from Ringsby. Occasional shipments were interlined with Freightways and Sturm. In June, 1955, at both Sioux City and Omaha, he interchanged 400 shipments with Watson. This dropped to nothing in 1956. In June, 1955, at the same two points, he received from 300 to 500 shipments from Freightways, and in June, 1956, he interchanged about 5 shipments with this carrier. In the first nine months of 1956, his gross revenue, including interstate and intrastate was $70,000 less than that for the corresponding period of 1955. He was approached by union representatives, beginning in August, 1955, relative to signing a contract. He was advised by one union representative that a drive was on for memberships in Nebraska and that non-union motor carriers were being contacted.

McKay operates terminals at Omaha, Fairbury and Beatrice, Nebraska. It operates to and from about 45 points in Nebraska, some of which are not served by any other regular route motor carrier. Service is rendered daily out of Omaha and Lincoln. On April 17, 1956, a large number of motor carriers discontinued normal interchange with him at Lincoln and Omaha. In 1955 at these points he received 1,215 interstate shipments by interline from other motor carriers, and in 1956 received only 210. Gross revenue of $205,000 in 1955 dropped to $156,000 in 1956. On some occasions his driver was permitted to pick up the necessary freight bills and shipments at certain connecting carriers' terminals. At other times he was not allowed to obtain the bills or the freight. Ringsby has accepted traffic from McKay since April, 1956, and Burlington and Santa Fe Trail have continued to interchange traffic at Omaha and Lincoln with him.

Wilber interchanges traffic at Omaha and Lincoln. Their annual gross revenue totals $60,000, and forty per cent is derived from interstate traffic, including shipments transported between Council Bluffs, Iowa and Crete, Nebraska.

Peters operates daily between Omaha and Fremont, and transports some interstate traffic between these points. At time of hearing he was still interchanging traffic with Prucka, Burlington and I.N.T. He still interchanges freight now and then with certain other motor carriers, but not as frequent as formerly. Merchants, for example, before April, 1956, gave him a substantial amount of traffic, but after that time very little. Also, certain traffic which he had received from Independent was given to Joe Ray Freight Line. Most of his present interstate traffic consists of shipments received in Omaha from National Car Loading Company for delivery to Fremont. He grossed about $20,800 in 1956, which compares favorably with other years, and about 85 per cent of this revenue was derived from interstate business.

Derickson operates daily over U.S. Route 30 between Grand Island and North Platte, and interlines traffic at those points with various motor carriers without difficulty. Numerous consignees route their traffic for ultimate delivery over his line. His competitors over this route consider his service adequate.

Steffy operates over routes between Omaha and Creston, Nebraska, and between Dodge, Nebraska and Sioux City, Iowa. Some of his points on and near Nebraska Highway 91, east of Creston, are not served by any other carrier. It interchanges traffic at Omaha with various motor carriers. Its profit in 1955 amounted to about $6,000.

Lyon operates daily between Omaha and numerous points in northeastern Nebraska, including Norfolk, Albion, Newman Grove, Madison, Columbus, Elgin, Neligh and Central City. He serves about 30 Nebraska points regularly and interchanges interstate traffic at Lincoln and Omaha. Most of his traffic is transported between Omaha and Columbus. Although Lyon operates over routes from Lincoln to Columbus, very little traffic is transported by him between those points. While he has been able to interchange with Burlington at Lincoln since September 1956, Red Ball has not interchanged shipments at that point. In February 1956, Lyon was approached by representatives of Teamsters Local No. 554 to sign a contract. He inquired whether the Union represented his employees. When informed they did not, he refused to sign a contract. Subsequent efforts were made by the Union to induce Lyon to sign a contract and when these attempts failed, normal interchange ceased at Omaha on March 21, 1956. Previous to that time Lyon had been interchanging traffic with numerous line-haul motor carriers, but after that only certain operators continued to interline shipments with him on a regular basis, viz., Box Truck Lines, Inc., Burlington, Ringsby, D.M.T., and National Carloading. Prucka tendered some freight to Lyon during the last week of January 1957. Certain of the carriers who no longer interchange with Lyon regularly, do accept occasional shipments, but there have been instances when Lyon has not been given freight by these carriers which was routed over his line. There have been no strikes or labor disputes on Lyon's line, and no pickets were established at his place of business.

Winter operates between Omaha and Lincoln. His interstate traffic is small.

Frear, under his Pawnee Transfer rights, can operate over regular routes between numerous points in southeastern Nebraska, including operations from Pawnee City to Lincoln, Lincoln to Beatrice, and Pawnee City to Omaha. Under his Superior Transfer rights he can operate over regular routes between various points in southeastern Nebraska, including operations between Superior and Hastings, Superior and Franklin, and Fairbury and Franklin. The Pawnee Transfer and Superior Transfer operations are not connected by any regular route, but these operations can be connected by the use of certain irregular route authority.

Clark operates over regular routes between Omaha, Lincoln and Sioux City, Iowa, on the one hand, and on the other, numerous points in northeastern Nebraska, including Fremont, Norfolk, Neligh, Grand Island, Newman Grove and Madison. It serves about 85 points, and 12 of these have no regular route motor carrier service other than Clark. It interchanges most of its traffic at Omaha and some at Lincoln. About 90 per cent of its traffic is transported between Omaha and Norfolk. In 1955 Clark grossed $286,346; 40 per cent from interstate, and 60 per cent from intrastate traffic. In 1956 gross revenue was $217,412; 4 per cent from interstate and 96 per cent from intrastate. Prior to September, 1955, Clark conducted normal interchange with numerous motor carriers. Early in September, 1955, representatives of Teamsters, (Local No. 554), who claimed to represent Clark's employees, visited Norfolk to negotiate an agreement. Clark declined to sign a contract because the union desired to include the carrier's employees at Norfolk as well as those at Omaha. On or about September 17, 1955, a picket line was placed at Clark's Omaha terminal. Thereafter deliveries of interchange traffic to this terminal ceased generally. Clark did, where possible, deliver outbound interchange shipments to connecting carriers. On October 1, 1955, Clark decided to file charges of unfair labor practices against Teamsters with the National Labor Relations Board. This action culminated in a settlement agreement on December 7, 1955, by representatives of Local 554, Fred L. Clark, and a representative of N.L.R.B. The agreement was approved by the Regional Director of N.L.R.B. Among other things, the agreement provided for the posting of a notice at the business office of Local 554 at Omaha, which in effect stated that the Union would not induce or encourage employees of Santa Fe Trail, Red Ball, Merchants, Trans-American, D.M.T., Buckingham Transportation Company, Omaha Cold Storage Company or Sinclair Refining Company, or any other employer to engage in a strike or concerted refusal in the course of their employment, to handle or work on goods, articles, materials or commodities, or to perform services for their respective employers where an object thereof was to force or require said employers to cease doing business with Clark, or to force or require Clark to recognize or bargain with the Union as the collective bargaining representative in accordance with the provisions of Section 9, of N.L.R.B. Act, 29 U.S.C.A. § 159. This notice was placed also at various docks and terminals in Omaha. Thereafter, normal interchange with most motor carriers was resumed for a while until Clark's interline business dropped noticeably after January 10, 1956. However, from February through May, 1956, interchange was continued with Santa Fe Trail, Burlington and Wilson. Pickets, however, remained at Clark's terminal and were still there in March, 1956, including one of Clark's former employees (employed prior to September 14, 1955). No pickets have been placed at the Norfolk Terminal. Four of Clark's employees went on strike initially. On September 14, 1955, he had seven employees.

The Union activity was such that Clark sought relief from National Labor Relations Board, which Board applied for and obtained a temporary restraining order in United States District Court for Nebraska. The order of the Court, pending final determination of the matter before the Board, was calculated to enjoin picketing at the premises of various motor carriers and shippers who did business with Clark, and to restrain the commission of acts or conduct inducing or encouraging the employees of said carriers or shippers to engage in a strike or a concerted refusal in the course of their employment to use, process, transport, or otherwise handle or work on any goods, articles, materials or commodities or to perform any services where the object was to force or require said carriers or employers to cease doing business with Clark or to force or require Clark to recognize or bargain with Teamsters or any other labor organization as the collective bargaining representative of any of Clark's employees unless and until the Teamsters, etc., was certified as the representative of said employees in accordance with Section 9 of National Labor Relations Act. Thereafter Clark tendered interstate shipments from time to time to certain motor carriers in Omaha. Specific instances were shown where D.M.T., Haeckl, Red Ball, Burlington and Buckingham Transportation did accept shipments in October, 1956. Since then tenders of interstate freight have been made to certain carriers and Clark found that the traffic was accepted in some instances and refused at other times. Seeking motor carriers to accept freight has resulted in delay, sometimes taking at least two days to dispose of shipments. On December 26, 1956, the N.L.R.B. in the proceedings involving Clark and the Union, entered an order requiring Teamsters Local No. 554 to cease and desist from certain unfair labor practices in violation of the National Labor Relations Act.

Generally the stockholders of applicant, with the exception of Clark, have had no dispute with their employees. They are parties to certain tariffs published by rate bureaus and have executed concurrences for the interchange of freight on through routes and through rates with various connecting motor carriers, including protesting motor carriers who are also parties to the published tariffs. They hold themselves out to transport interstate freight on a through route rate basis.

Shippers from some fourteen towns and cities in Nebraska supported the application. Shipments of drugs requiring expeditious delivery under refrigeration were delayed; rush order shipments of automotive parts were delayed. The same is true of clothing and drug shipments, butter shipments of the value of $18,000 to Chicago from a butter factory at Burwell, Nebraska, shipments of leather, newspapers, magazines, catalogues, advertising material, repair parts for farm machinery, truckload shipments of butter from Newman Grove, Nebraska, department store products, hardware store products and farm machinery parts from Sargent, Nebraska, hardware store supplies at Pierce, Nebraska, petroleum products, tires and accessories at Tilden, Nebraska, truck parts at Loup City, Nebraska, emergency shipments of auto parts at Neligh, Nebraska, tire shipments, seed, outboard motors, boats, marine hardware, plumbing fixtures, water softeners and related supplies, heating and air conditioning equipment, and dairy products from Kansas City, Chicago, Des Moines and St. Louis to Norfolk, Nebraska, raw materials for the manufacture of farm and industrial equipment, including corn cribs, grain bins, crop-drying machines and power steering devices from Kansas City, Denver, St. Louis, Minneapolis, Sterling and Chicago, Illinois and Hammond, Indiana, to Columbus, Nebraska, products for a chain organization located at Fairbury, Nebraska, receiving a wide range of commodities from Minneapolis, Chicago, Kansas City and St. Louis, wallpaper, floor coverings and other merchandise from St. Louis, Chicago, Lyons and Joliet, Illinois, Kansas City, Minneapolis, St. Paul and Des Moines, Iowa to Fairbury, Nebraska, pump jacks, cylinders, water supply equipment, windmills and plumbing supplies from various scattered centers over the middlewestern and Rocky Mountain states to Fairbury, Nebraska, drugs, department store commodities for Lincoln, Nebraska, heating and air conditioning equipment, various manufactured products, including frames for upholstered furniture, cabinets and television set bases, products for storage in two large warehouses, including products from large tobacco manufacturers and packing houses to, from and into Omaha from various centers over the country. The record is replete with delays, unnecessary tracing of shipments, inconveniences and losses, all because, as a former owner of Independent, testified that his Company, as a result of the fact that Romans was engaged in a labor dispute over the employees refusal to be organized, was not in a position to order its employees to "either do business or not to do business" with Romans, and that "if the men chose not to do it, that was their own responsibility."

The record further shows that Omaha, with a 1950 population of 251,117, is both a railroad and trucking center. Ten rail systems and numerous truck lines operate through or to this centrally located city. All the rail carriers are more or less fully unionized, and all or nearly all the larger trucking companies are unionized under contracts with the Teamsters Union.

The Teamster contracts include what is known as a hot cargo clause, providing as follows:

    "It shall not be a violation of this Agreement, and
  it shall not be cause for discharge if any employee
  or employees refuse to go through the picket line of
  a Union or refuse to handle unfair goods. Nor shall
  the exercise of any rights permitted by law be a
  violation of this Agreement. The Union and its
  members, individually and collectively, reserve the
  right to refuse to handle goods from or to any firm
  or truck which is engaged or involved in any
  controversy with this or any other Union; and reserve
  the right to refuse to accept freight from or to make
  pickups from, or deliveries to establishments where
  picket lines, strikes, walkouts, or lockouts exist.
    "The term `unfair goods' as used in this Article
  includes, but is not limited to, any goods or
  equipment transported, interchanged, handled, or used
  by any carrier, whether party to this Agreement or
  not, at any of whose terminals or places of business
  there is a controversy between such carrier or its
  employees on the one hand, and a labor union on the
  other hand; and such goods or equipment shall
  continue to be `unfair' while being transported,
  handled or used by interchanging or succeeding
  carriers, whether parties to this Agreement or not,
  until such controversy is settled.
    "The Union agrees that, in the event the Employer
  becomes involved in a controversy with any other
  Union, the Union will do all in its power to help
  affect a fair settlement.
    "The Union shall give the Employer notice of all
  strikes and/or the intent of the Union to call a
  strike of any Employer and/or place of business,
  and/or intent of the members to refuse to handle
  unfair goods. The carriers will be given an
  opportunity to deliver any and all freight in their
  physical possession at the time of the receipt of
  notice.
    "Any freight received by a carrier up to midnight
  of the day of the notification shall be considered to
  be in his physical possession. However, freight in
  the possession of a connecting carrier shall not be
  considered to be in the physical possession of the
  delivering carrier.
    "The insistence by any employer that his employee
  handle unfair goods, or go through a picket line
  after they have elected not to, and if such refusal
  has been approved in writing by the responsible
  officials of the Central States Drivers Council,
  shall be sufficient cause for an immediate strike of
  all such employer's operations without any need of
  the Union to go through the grievance procedure
  herein."

The plaintiffs and intervening plaintiffs' carriers are large trunk line carriers, carrying freight from the entire country to the port of Omaha, and receive and interchange freight at this location from smaller carriers who operate in eastern Nebraska, in joint tariff operations. These smaller carriers use Omaha as a principal or important interchange point, and carry outgoing freight from and deliver incoming freight to a very large number of Nebraska communities. Carriage by motor freight lines furnishes the transportation facilities for most of these communities, and their normal existence depends on the uninterrupted flow of motor carriage of goods to ...


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