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Burlington Northern Inc. v. Northwestern Steel & Wire Co.

decided: July 7, 1986.

BURLINGTON NORTHERN, INC., PLAINTIFF,
v.
NORTHWESTERN STEEL & WIRE CO., DEFENDANT-PETITIONER-APPELLANT, V. INTERSTATE COMMERCE COMMISSION, RESPONDENT-APPELLEE; BURLINGTON NORTHERN, INC., A CORPORATION, PLAINTIFF-APPELLEE, V . NORTHWESTERN STEEL & WIRE CO., A CORPORATION, DEFENDANT-APPELLANT



Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 80 C 1230 - Charles R. Norgle, Judge.

Author: Cudahy

Before CUMMNGS, Chief Judge, CUDAHY and EASTERBROOK, Circuit Judges.

CUDAHY, Circuit Judge.

Burlington Northern, Inc. ("Burlington Northern") and Northwestern Steel & Wire Co. ("Northwestern Steel") disputed rail charges for services performed between 1977 and 1979. Burlington Northern filed a complaint in the District Court for the Northern District of Illinois to collect the contested funds. That case was referred to the Interstate Commerce Commission (the "ICC"). Northwestern Steel then filed a complaint with the ICC contending the charges were unreasonable. The Administrative Law Judge and an ICC Review Board found for Burlington Northern. Northwestern Steel filed an appeal to this court, which dismissed the case for lack of jurisdiction, noting that jurisdiction belonged with the referring court. Northwestern Steel then filed an appeal to the district court and Burlington Northern filed suit there to collect its payment. The district court dismissed Northwestern Steel's claim as untimely and denied its motion for summary judgment on Burlington Northern's suit to collect the charges. Northwestern Steel appeals both rulings. We affirm.

Northwestern Steel arranged for Burlington Northern to make numerous shipments of 80,000 pounds of steel wire mesh from its Sterling, Illinois factory to various points in Texas over a period of several years. Northwestern Steel calculated its expected rates on the assumption that Burlington Northern would use a single 60-foot rail car for each shipment. In fact, Burlington Northern used two shorter cars for each shipment instead of one 60-foot car. This led Burlington Northern to impose additional charges on Northwestern Steel on some 380 shipments. When Northwestern Steel refused to pay, Burlington Northern filed a complaint in district court under 49 U.S.C. § 10761 to collect additional charges of $133,102.62.

The district court believed that the suit was within the primary jurisdiction of the ICC. Therefore, with the parties' consent, the suit was stayed in district court and was referred to the ICC. Northwestern Steel then filed a complaint with the ICC alleging that the charges sought by Burlington Northern were unreasonable and in violation of Rule 66(a) of Tariff Circular 20 (49l C.F.R. § 1300.66(a)). The company argued that the two for one substitution was arbitrary and merely for Burlington Northern's convenience.

The Administrative Law Judge dismissed Northwestern's complaint, concluding that Northwestern Steel had not met its burden of proof that the charges were unreasonable because it had not shown that a car of particular size had been ordered or that the single, larger car would have been adequate for the task. The ICC review board affirmed the dismissal and also concluded that Rule 66(a) did not apply to the contested charges.

Northwestern Steel then filed an appeal to this court alleging jurisdiction under 128 U.S.C. §§ 2321(a)*fn1, 2342(5)*fn2, and 2344*fn3 The ICC and Burlington Northern filed a motion to dismiss on the ground that in referred cases the referring court has exclusive jurisdiction to review appeals from the ICC under 28 U.S.C. §§ 1336(b)*fn4 and (c)*fn5 The filing of this motion prompted Northwestern Steel to file in the district court a Motion for Leave to File a Complaint For Review of the Decision of the Commission. The government opposed this motion. The district court stayed determination of the motion pending the outcome of the Seventh Circuit case.

This court granted the motion to dismiss stating:

The parties' stipulation for a stay of district proceedings had the effect of a referral to the Interstate Commerce Commission. 28 U.S.C. Sec. 1336(b). In addition, it appears that the district court also has a Sec. 1336(a) jurisdiction since its order had to do with the payment of money. Moreover, whatever the trial court's ultimate decision, review by this court of its decision will be available if an appeal is taken.

Northwestern Steel & Wire Co. v. United States, No. 81-2726 (7th Cir. Mar. 29, 1982) (order).

The district court then accepted Northwestern Steel's petition for review of the ICC decision. The government contended that the motion was untimely because 28 U.S.C. § 1336(c) establishes a 90-day time limit for filing appeals in a referring court from an ICC decision. Northwestern Steel's appeal was filed after 134 days had passed. The district court agreed that Northwestern Steel's motion was untimely. It stated that the 90-day restriction "was jurisdictional and must be strictly construed." Northwestern Steel & Wire Co. v. ICC, No. 80 C 1230 slip. op. at 17 (N.D. Ill. Feb. 3, 1983).

Following the dismissal of Northwestern's appeal, both parties moved for summary judgment on Burlington Northern's suit seeking additional payment. Northwestern Steel argued that Burlington Northern's suit to collect the fees was untimely because it was a suit to enforce an ICC order and had to be filed within 90 days. The court denied Northwestern Steel's motion, however, determining that Burlington ...


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