The Assigned Car Cases

Background

Five lawsuits were brought by coal companies, large coal consumers, private owners of coal cars, and thirty-five railroads to block an Interstate Commerce Commission order that would limit the number of assigned coal cars placed at any mine during car shortages. The Commission’s rule counted all cars (private, railroad fuel, and system cars) and prohibited a carrier from placing more cars at a mine than that mine’s rateable share, unless the Commission issued an emergency exception. The dispute grew out of prior, varied practices and long Commission investigations into what the court called discriminatory car distribution.

Reasoning

The core question was whether Congress gave the Commission authority to set a uniform rule and whether that rule was reasonable. The Court found the statute authorized the Commission to make rules about car service and to require all cars be counted when deciding a mine’s share. The Court held the record supported the Commission’s findings that the assigned-car practices caused unfair advantages and poor service, that the order did not amount to an unlawful taking, and that emergency powers could address hardships.

Real world impact

As a result, owners of private or railroad-assigned cars can no longer guarantee more than a mine’s pro rata share during shortages without Commission permission. Mines that had relied on assigned cars lose their preferential access, while other mines gain steadier allocation. The order applies nationwide but allows the Commission to grant emergency relief in particular cases.

Dissents or concurrances

Justice McReynolds dissented, arguing the Commission overreached into railroad management, would idle private cars, and wrongly forced large consumers to scatter purchases; he would have upheld the lower court’s injunction.