Finally, it should be emphasized that this Commission, time-and-time again, has stated that the Interstate Commerce Act provides, among other attributes, an opportunity or atmosphere for keen competition between the regulated carriers. The record indicates that the proposal allegedly is an attempt to maintain some equality with the Rock Island. See, in this respect, Corn & Soybeans Midwest to Gulf Ports, supra, which involves the Rock Island. As has been evident from the several proceedings cited above, the principals, the Missouri Pacific and the Southern Pacific, have again chosen to stay in the wings rather than to make an appearance. This raises an important but unaswered question. Do the circumstances in the several cited proceedings, among other matters, indicate an unlawful agreement not to complete! I leave that question for others to answer. In summary, I would find that respondent has failed to justify its proposal, without prejudice, however, to a refiling in conformity with the act, and other statues. Accordingly, I respectfully dissent from today's decision. COMMISSIONER HARDIN, dissenting: For the reasons set forth in my dissenting expressions in proceedings where similar issues relating to the railroad rate structure to Corpus Christi were involved, Soybeans, Midwest to Chicago & Gulf Ports, Export, 335 I.C.C. 883, 891, Corn & Soybeans Midwest to Gulf Ports, for Export, 339 I.C.C. 595, 620, Corn & Soybeans Midwest to Gulf Ports, 349 I.C.C. 1, 6, and Investigation and Suspension Docket No. 9052, Wheat, New Mexico and Texas Ports, decided October 9, 1976 (unprinted), I dissent. I agree with the majority on the lawfulness of the schedule in relation to section 1(6), but disagree that the Santa Fe reductions do not violate our orders in the Nueces County cases and are not contrary to section 3(1). The orders entered in the Nueces County cases require numerous defendants including Santa Fe to maintain rates to Corpus Christi no higher than those to Galveston and Houston. Those orders remain in effect today and until modified by the Commission establish the context in which this proceeding should be decided. Until the supplement 76 rates became effective Santa Fe through an agreement with Missouri Pacific in connection with movements to Corpus Christi and by reason of its single-line service to Houston and Galveston complied with the orders. However on August 28, 1976, when the reduced rates took effect to the four north Texas ports served direct, but not to Corpus Christi, it became in violation of the oustanding orders. It is no answer in a legal sense that Santa Fa is willing to apply the reduced rates to Corpus Christi but was prevented from doing so by the unwillingness of Missouri Pacific to participate on the same divisional basis as applied in connection with the prior rates. Division of revenue between carriers on joint line traffic is primarily a carrier concern, and Santa Fe on being made aware of Missouri Pacific's stance ought to have resolved the dispute before proceeding with publication. Because of the outstanding orders, Santa Fe may not make a rate decision which has the effect of being contrary to the orders in docket Nos. 31098 and 33447. Treating now the section 3(1) issue, it is apparent that Santa Fe controls the rates, by reason of its ability to give single line service, from the origin area to the four north Texas ports. Because Santa Fe originated traffic may reach Corpus Christi only if Missouri Pacific agrees to participate, it is clear that Santa Fe and its connecting carrier jointly control the rates to Corpus Christi. For many years respondent and Missouri Pacific participated in rates which recognizes the principal of Texas port equality. As recently as August 28, 1976, Santa Fe and Missouri Pacific were in common responsible for maintaining rates to Corpus Christi and the north Texas ports. This long standing practice cannot be cast off by respondent because of a dispute over divisions. Controversies between carriers over divisions of revenue do not deprive the shipping public of the substantive protection accorded by section 3(1). I note that as of the hearing Santa Fe itself and in conjunction with its connecting lines apply equal rates from the origin area to all Texas ports on export shipments of wheat destined to Hawaii, Panama Canal Zone, and insular possessions of the United States. These rates at the Ex Parte No. 330 level are in every instance lower than the reduced rates established to the north Texas ports. Though the record is not entirely clear on the amount retained by Santa Fe on joint-line movements to Corpus Christi, it appears that the divisional arrangement which applied to the section 4 rates in effect prior to August 28, 1976, also applies on the Hawaii and insular possessions traffic. In view of Santa Fe's long association with wheat movements to all the Texas ports pursuant to rates which accord equality to ports served direct and through connecting roads, it is not free to take action which disregards equal treatment to competing ports. It is no answer to claim that such a finding is contrary to the right of a carrier to publish rates by independent action as guaranteed by section 5b of the act. The latter guaranty must be considered in the context of a carrier's total regulatory obligations. Santa Fe has participated in equal rates to Corpus Christi for many years. Over this time Corpus Christi interests have planned their activities on the assumption that this would continue to be the practice. Santa Fe cannot abandon this long practice on the claim of independent action. The exercise of the right of independent action does not excuse violation of outstanding Commission orders. A substantial quantity of evidence was presented concerning whether or not protestants would be actually or potentially injured by the failure to receive. rates on the level of those maintain to the north Texas ports. I believe they will be injured. It is not disputed that growers of wheat in the origin area will not sell wheat for delivery to Corpus Christi at the handicap imposed by the higher rates to this port. Exhibit 7 shows that in 1975, 3,644 tons originated in the origin area and moved to Corpus Christi for export. This comprised about 3.5 percent of the total tonnage to the Texas ports. Protestant Louis Dreyfus Corporation shows that for the 12 months ended May 31, 1976, about 1.7 percent of its Corpus Christi exports had an actual or a transit origin in the affected area. Up to the 1976 harvest protestant Producers Grain Corporation exported little or no traffic which had an origin in this territory. However, as of August 28, 1976, it held in open storage about 290,000 bushels which came from the origin area. Though not then owned by protestant this wheat will probably be sold to the latter and exported through Corpus Christi. On the basis of 1975 exports this would represent about 1 percent of total exports. Protestant Nueces County Navigation District shows that during calendar 1975, 2,061,848 bushels or about 10 percent of the port's 1975 exports originated at 12 Oklahoma origins served by Santa Fe. However, the bulk of this traffic originated at Enid which is served also by the Rock Island and Frisco, and it may not be assumed that all the 2,061,848 bushels moved to Corpus Christi in the origin service of Santa Fe. From the origins here involved 53,575 bushels or about two and a half tenths of 1 percent moved to protestant's clevator. Though the evidence establishes that protestants do not purchase significant quantities of wheat grown in the origin area, the record is clear that the impact of the failure to accord equality to Corpus Christi cannot be considered as insignificant. It is established that under a rate structure imposing a handicap ranging from 1.5 to 5 cents a bushel on Corpus Christi, no grower will sell on the gulf coast bid with delivery at Corpus Christi. Thus protestants will be precluded from purchasing wheat in the origin area. The ability of an exporter to purchase even small quantities in a competitive market is important. The economics of grain merchandising make it likely that protestants' exclusion from the purchase of wheat in the south central Kansas and north central Oklahoma growing area will make for difficulty in the purchase of wheat in the surrounding areas at prices competitive with those of its rivals who export through the north Texas ports. Finally, if the assumption of the majority is correct and the outstanding orders in docket Nos. 31098 and 33447 do not preclude the lawful publication of the contested rates, it is necessary to consider whether the failure to provide for similarity of rate treatment is justified by a difference in transportation conditions between the north Texas ports and Corpus Christi. Respondent emphasizes that the reductions were made necessary by truck competition made worse by the origin rate disparities. In numerous proceedings the Commission has found that a difference in rate treatment is justified where there is a difference in competitive conditions. I agree the record shows that there is a motor competition from the origin area to Enid and Houston, but not to Corpus Christi. In my opinion, however, the record is equally clear that the reduced rates will have no effect on the extent of motor competition. First I note that the reductions of August 28, 1976, were followed within less than 6 weeks by the Ex Parte No. 330 increase which raised the rates, on the average, to the prereduction level. The testimony of the five country elevator operators discloses that both the rail origin station disparities and the rail-motor rate levels at the same origin were important considerations dictating the use of motor carriage, but it is equally clear that the supplement 76 reductions as increased by Ex Parte No. 330, and now by Ex Parte No. 336, will not necessarily make rail service more attractive. Santa Fe's experience at Alva-Avard seems to bear this out. Another element bearing on the use of motor service relates to railcar supply. Several country elevator operators testified to using motor service because of railcar shortages. It is obvious that a reduction rail rates will not remedy the car supply problem. It appears to me that respondent in claiming that the reductions were impelled by the origin rate disparities and motor competition was less than candid. I conclude that the supplement 76 reductions were designed to divert traffic, which had heretofore been moving to Corpus Christi, to ports served by Santa Fe in single-line service. Respondent also points out that the cost of providing service to Corpus Christi is higher than to the four north Texas Ports. The record shows, however, that the rates would be compensatory to all the Texas ports. COMMISSIONER GRESHAM, dissenting: For the reasons expressed in dissent in Corn & Soybeans Midwest to Gulf Ports, 349 I.C.C. 1, 6, and Wheat, New Mexico and Texas to Texas Ports, 355 I.C.C. 237, I cannot approve a proposal which effectively excludes Corpus Christi from this traffic. COMMISSIONER O'NEAL, dissenting: I agree with most of the points made by the other dissenting members. More pointedly, as I observed in my separate expression in Corn & Soybeans to Gulf Ports, 349 1.C.C. 1, at 8, under the common control doctrine asserted by the majority, any carrier serving one port in connection with through routes with other carriers could negate the effect of section 3(1) any time it could not, or were unwilling to, work out a divisions arrangement or wished to prefer origins on its own lines. Such as result would overlook the interrelation of all applicable sections of the act. The majority is correct in its generalization that respondent is free to manage its affairs in the manner it choose so long as its action is not contrary to the tenets of the Interstate Commerce Act. But this record is far from convincing that the proposal now before us is not contrary to the Interstate Commerce Act. The absence of connecting railroads before us in this proceeding for whatever reason cannot sanction respondent's unilateral action which in my view brings into being unreasonable practices in violation of section 1(6); in violation of the mandate, recently affirmed and preserved in the 4R Act amendment, that rate relationships between ports be maintained; and in violation of our outstanding orders in docket Nos. 31098 and 33447, lawfully issued by the Commission pursuant to appropriate provisions of the Interstate Commerce Act. The respondent has failed to justify the proposal and I, therefore, respectfully dissent. It is ordered, That this proceeding be, and it is hereby discontinued. 357 I.C.C. EX PARTE NO. 307 INVESTIGATION INTO THE DISTRIBUTION AND MANIPULATION OF RAIL ROLLING STOCK TO DEPRESS PRICES ON CERTAIN GRAIN SHIPMENTS FOR EXPORT Decided July 18, 1977 Upon investigation, Bureau of Investigations and Enforcement directed to conduct further investigation into possible violations of provisions of Interstate Commerce Act and The Elkins Act by respondents Illinois Central Gulf Railroad Company and Continental Grain Company in certain operations conducted during the year 1973. Proposed rules for distribution of grain cars and proposal to cancel consecutive trip provisions in unit-grain-train tariffs not adopted. Proceeding discontinued and appropriate order entered. James R. Taylor for the Bureau of Enforcement, Interstate Commerce Commission. Thomas C. Adam, Victor Anderson, Andrew P. Goldstein, Richard J. Hardy, R. Joseph D. Anthofer, Martin Cassell, John A. Daily, John H. Doeringer, Richard REPORT OF THE COMMISSION BY THE COMMISSION: This proceeding was instituted on July 2, 1974, on our own motion, under the authority of part I of the Interstate Commerce Act, particularly sections 1, 2, 3, 6, 12, 13, and 15, and selected supplementary legislation, particularly section 2 of the Elkins Act, (49 U.S.C. Sec. 42). The preamble to the order of July 2, 1974, sets forth the background to the proceeding and, for information, is quoted here in its entirety. The Commission's Bureau of Operations has conducted a field investigation in response to numerous complaints received from country grain elevator operators, public officials, and other persons concerned with the improper use of the instrumentalities of transportation to affect prices in the grain market. The investigation embraced the possible discriminatory application of provisions in multiple-car grain tariffs which permit the use of railroad-owned equipment by grain interests and |