United States v. American Sheet & Tin Plate Co.

Background

Five large industrial companies challenged orders from the Interstate Commerce Commission that told rail carriers to stop spotting freight cars on the companies’ internal plant tracks and to stop paying allowances when industries did that spotting themselves. The Commission’s Ex Parte No. 104 investigation examined evidence from about two hundred plants and concluded that line‑haul rates were not fixed to cover in‑plant spotting and that allowances had become an abused practice. A three‑judge District Court set aside the Commission’s orders, and the issue was appealed to this Court.

Reasoning

The central question was whether moving cars from interchange tracks onto points inside a plant is part of the railroad’s delivery duty covered by interstate line‑haul rates. The Commission found that delivery is complete when cars reach the industry’s interchange tracks, and that further spotting inside plants involved extra operations and burdens not included in the line‑haul charge. It also found that allowances gave certain industries preferential service. The Court held the Commission’s findings had substantial support in the record and that the Commission lawfully could require carriers to stop performing or paying for spotting beyond interchange tracks.

Real world impact

Rail carriers may withdraw in‑plant spotting service and cancel allowances set in tariffs. Industries that previously received allowances may now have to perform and pay for spotting themselves. The decision affects carrier billing, industry‑carrier agreements, and how freight is handled at large plants; the Court reversed the lower court and sent the cases back for further proceedings.

Dissents or concurrances

Justice Butler dissented, arguing the Commission’s view that delivery ends at interchange tracks was not supported by the facts and that the lower court’s decrees should be affirmed.