As indicated in the report, this identical question, i. e., as to the relation between the rates on rough and dressed Bedford stone, has been before us a number of times, and has been ably and exhaustively presented, and carefully considered. In all the cases except one, the latest decision having been rendered in 1926, no spread was required. In the excepted case, decided in 1917, a spread of two cents was prescribed. In view of the weight of precedent in favor of a finding that the maintenance of the same rates on the rough and dressed stone does not result in undue prejudice, a conclusion such as that here reached by the majority should be based upon only the most clear and convincing evidence. In my opinion the evidence of undue prejudice on this record falls far short of that standard. No. 211131 DUNN MANUFACTURING COMPANY v. ATCHISON, TOPEKA & SANTA FE RAILWAY COMPANY ET AL. Submitted July 27, 1929. Decided October 14, 1929 Rates on oil-well tools, in carloads, from Oxnard, Calif., to Panhandle, Tex.. and Tulsa, Okla., and from Houston, Tex., to Los Angeles, Calif., found not unreasonable or otherwise unlawful. Complaints dismissed. W. P. Bowman for complainants. J. E. Lyons for defendants. REPORT OF THE COMMISSION DIVISION 3, COMMISSIONERS AITCHISON, TAYLOR, AND PORTER BY DIVISION 3: Exceptions were filed by complainants to the report proposed by the examiner. Complainants in these cases are corporations manufacturing oil-well tools at Oxnard, Calif., and Houston, Tex. In No. 21113, filed April 24, 1928, the rates charged on 28 carloads of oil-well tools shipped from Oxnard to Panhandle, Tex., and Tulsa, Okla., between August This report also embraces No. 21113 (Sub-No. 1), Hughes Tool Company v. Galveston, Harrisburg & San Antonio Railway Company et al., and No. 21948, Same v. Atchison, Topeka & Santa Fe Railway Company et al. Informal complaints covering the shipments embraced in this complaint were filed on August 15 and September 20, 1927. Complainant was advised December 23, 1927, that the informal complaints were not susceptible of informal adjustment. 29, 1925, and June 22, 1927, and in No. 21113 (Sub-No. 1) filed August 27, 1928, the rates charged on 10 carloads of oil-well tools shipped from Houston, Tex., to Los Angeles, Calif., between September 4, 1926, and February 16, 1927, are assailed as unreasonable, unjustly discriminatory, and unduly prejudicial. The complaint in No. 21948, filed February 4, 1929, is similar to that in No. 21113 (Sub-No. 1) except that it names different defendants. No. 21948 was submitted on the record made in Nos. 21113 and 21113 (SubNo. 1). Reasonable rates for the future and reparation during the respective statutory periods and pendente lite are sought. Rates will be stated in amounts per 100 pounds. Oil-well tools are included in the description of oil-well outfits and supplies rated class A, in carloads, minimum 36,000 pounds, in the governing western classification. The average aggregate value of a shipment weighing 49,054 pounds, the average weight of 38 carloads shipped from Oxnard to Tulsa over a 3-year period, is $24,623 or approximately 50 cents per pound. Certain of complainants' oilwell tools are patented. They are painted to avoid damage by the elements and may be loaded in open equipment. They are extremely heavy and easily load to the capacity of the car. Complainants have filed no loss or damage claims on this traffic. Between August 29, 1925, and July 14, 1928, complainant in No. 21113 shipped 31 carloads from Oxnard to Tulsa and 1 to Panhandle. Complainant in Nos. 21113 (Sub-No. 1) and 21948 ships approximately 80 carloads a year from Houston to Los Angeles. A rate of $1.74, minimum 36,000 pounds, on oil-well tools, in carloads, from Oxnard to Panhandle and Tulsa and from Houston to Los Angeles has been in effect since November, 1923. On November 15, 1926, a rate of $1.46, minimum 50,000 pounds, was established on this traffic eastbound from Oxnard to Panhandle and Tulsa and on May 1, 1927, this rate and minimum was made applicable in the opposite direction from Houston to Los Angeles. These rates apply between groups covering extensive territories. Refund to the basis. of the $1.46 rate has been made on five of the shipments named in the complaint in No. 21113 which were overcharged. Complainants rely upon comparisons of the rates assailed with rates on commodities accorded the same or higher classification ratings. The following table compiled from their exhibits compares the class and commodity rates on oil-well tools from Oxnard to Tulsa with rates on machinery and machines, n. o. i. b. n., metal automobile parts, and other commodities from and to the same points, and also shows the percentage relationship between the commodity rates and the class rates. Based on the applicable minima the assailed rates of $1.74 minimum 36,000 pounds, and $1.46, minimum 50,000 pounds, yield per car earnings of $626.40 and $730, respectively. Complainants compare these earnings with the per car earnings under rates for comparable hauls applicable on metal automobile parts, machinery and machines, motor-truck seat cabs and freight auto bodies, k. d., and storage batteries from Philadelphia, Pa., Detroit, Mich., Chicago, Ill., and Kansas City, Mo. The bulk of the movement of automobiles and automobile parts is from Detroit, Mich., and other points in westbound transcontinental Groups C and C-1 which embrace points in Michigan, Ohio, and Indiana. Based on the applicable minima the earnings under rates of $1.70, minima 30,000 pounds, on metal auto parts, $1.70, minimum 40,000 pounds, on machinery and machines, $1.48, minimum 40,000 pounds, on motortruck seat cabs and freight auto bodies, k. d., and $1.38, minimum 40,000 pounds on electric storage batteries from Detroit to Oxnard and other California terminal points are $510, $680, $592, and $552 per car, respectively. Complainant points out that automobile parts, such as fenders, gas tanks, and metal running boards are more susceptible to damage in transit than oil-well tools, and that this traffic is often moved in special equipment provided for use of the automobile industry entailing long hauls of empty equipment, and further, that in many instances cars can not be loaded to the required minimum. Complainants also refer to the liberal rules provided in the tariffs for the movement of this traffic in mixed carloads. Finished fenders, auto gear frames, radiators, and other articles rated higher than class A can be shipped from Detroit to California terminal points in mixed carloads with articles included in the description "auto parts, metal " at the rate of $1.70 applicable on the latter traffic. The same rate also applies on mixed carloads of metal automobile parts, machinery and machines, and electrical or pneumatic tools. Rates of 90 cents, $1.13, and $1.44, subject to minima of 60,000, 40,000, and 30,000 pounds, respectively, sought by complainants on oil-well tools from and to the points herein considered, are the same as those applicable westbound on wrought-iron or steel pipe, commodities which are rated fifth class. The circumstances under which the pipe rates were established and have since been maintained are not shown. Complainants contend that the maintenance of commodity rates on oil-well tools higher than those applicable on commodities accorded the same or higher classification ratings subjects their traffic to unjust discrimination and undue prejudice. Rate comparisons alone, which constitute practically all of complainants' evidence, are not sufficient to sustain an allegation of undue prejudice. Prejudice, in order to be undue, must ordinarily be such as to be a source of advantage to the party alleged to be favored, and generally a competitive relationship between the commodities must appear. California Walnut Growers' Asso. v. A. & R. R. R. Co., 50 I. C. C. 558. Defendants relate in detail the history of the commodity rates on oil-well tools from and to the points here considered. Prior to April 27, 1922, a class A rate of $2.50 applied on this traffic all-rail from Oxnard to Panhandle, Tulsa, and other points in transcontinental Group H. A rate of $1.50, minimum 24,000 pounds, applied via the water route through the Panama Canal from California terminals to Texas ports, and an all-rail rate of $1.665 maintained on this traffic from points in the Pittsburgh, Pa., district to Houston and other Group F points in Texas applied as a maximum at Tulsa and other intermediate points. In order to meet water competition and to permit California producers of oil-well tools to compete with manufacturers in the Pittsburgh district defendants, effective April 27, 1922, established a commodity rate of $1.75, minimum 50,000 pounds, on this traffic from Oxnard and other California points to Panhandle, Tulsa, and other Group H points. Upon application of the shippers, and because of commercial conditions, the minimum in connection with the rate was reduced to 36,000 pounds, during May, 1925. The assailed rate of $1.74, minimum 36,000 pounds, was estab lished in November, 1923, as part of a general readjustment following an investigation of transcontinental eastbound and westbound rates on oil-well supplies and machinery. The rate of $1.46, minimum 50,000 pounds, the same as that applicable on machinery and machines, but subject to a higher minimum was established during November, 1926, on application of the shippers for a lower rate with a higher minimum. The distance from Oxnard to Panhandle over the route the shipments moved is 1,361 miles, and the average distance to Tulsa over nine routes of movement is 1,867 miles. In the recent southwestern revision, we prescribed rates on oil-well supplies, minimum 36,000 pounds, from and to points in the Southwest based on 45 per cent of the first-class rates. The first-class rate from Oxnard to Panhandle and Tulsa is $4.20 and 45 per cent thereof $1.89. Under the scale prescribed in the southwestern revision the respective first-class rates for hauls of 1,361 and 1,867 miles, taking into consideration the hauls through so-called differential territory, are $3.623 and $4.28, and 45 per cent thereof, $1.63 and $1.93, respectively. Based on a weight of $46,672, the average weight of the 28 shipments in No. 21113, the $1.74 rate assailed from Oxnard to Panhandle and Tulsa yields car-mile earnings of 59.6 and 43.4 cents for hauls of 1,361 and 1,867 miles, respectively, and the $1.46 rate, using the same distances, but based on the minimum of 50,000 pounds, yields 53.6 and 39.1 cents per car-mile, respectively. The first-class rate from Houston to Los Angeles, 1,634 miles, is $4.50 and 45 per cent thereof $2.025. Under the scale prescribed in the southwestern revision the first-class rate for this distance is $4 and 45 per cent thereof $1.80. Generally speaking, the rates from Mountain-Pacific territory to the Southwest are higher, distances considered, than the rates applicable within the latter territory. Based on a weight of 45,320 pounds, the average weight of the 10 shipments in No. 21113 (Sub-No. 1), the $1.74 rate assailed from Houston to Los Angeles yields car-mile earnings of 48.2 cents for the haul of 1,634 miles, and the $1.46 rate, based on the 50,000pound minimum, yields car-mile earnings of 44.6 cents. Rates instanced by defendants on cotton bagging, steel rails, pressed steel, and other commodities, many of which have been approved by us, range from approximately 70 cents to $2.35 and yield car-mile earnings varying from 43.7 to 78.9 cents, for hauls of from 794 to 2,918 miles. Entire baul considered as within differential territory. |